OPINION | The ‘Repeat Founder’ advantage and what data actually says 

Most of India's iconic companies across sectors were built by first-time founders

Venture capital has long debated whether the "muscle memory" of a repeat founder outweighs the “unencumbered perspective” of a first-timer.   

​​Structural advantage of repeat founders

Historically, for Indian companies that have raised $10 million or more, repeat founders have built unicorns with 3x the success rate versus first-timers. These founders make up 30-35% of the unicorn pool despite representing just 10%-12% of the base.

The reasons are structural: they come with a strong learning curve, existing networks, better access to funds and the credibility to attract the right talent.

Success the first time around helps the next time

Prior success amplifies this further. Founders who’ve had a large exit build their next successful venture even faster. Mukesh Bansal's journey from Myntra to Cure.fit and Kunal Shah's from FreeCharge to CRED prove that they understand what ‘works’ and are quick to read early signals and act accordingly.

Cure.fit became a unicorn in five years and CRED was one in three years from inception. They were able to achieve this as they’ve led and steered teams towards a vision in the past and had the know-how to blitzscale.

First-time founders who created iconic companies

That said, most of India's iconic companies across sectors were built by first-time founders, including Sachin and Binny Bansal at Flipkart, and Harshil and Shashank founding Razorpay very early in their careers. Another big example is Zepto: Aadit Palicha and Kaivalya Vohra were fresh Stanford dropouts - they not only had no founding experience,

they did not have any operating background either. What they had was a sharp insight on quick commerce, the hunger to move fast, and a willingness to figure things out. It proves that razor-sharp focus and drive can substitute for experience.

While experience is definitely one way to earn conviction, for us, it has never been the only way.

In our venture journey, I’ve found that first-time founders are more risk-taking and willing to take true moonshot bets. They often showcase a “go big or go home” attitude. Also, they are more frugal than experienced founders, who have greater access to capital.

Repeat founders who didn’t succeed the first time

There is another cohort here: repeat founders whose first venture didn't succeed. From what I have seen, these founders carry most of the learning with none of the complacency. They have a stronger need to prove themselves and come back with a renewed zeal that gives them a unique edge.

Interestingly, among all unicorns built by repeat founders, 70% have been by founders whose prior venture did not yield any big exits or returns. 

AI is changing ground rules

While one can argue if the repeat founder advantage is real or not, with the advent of AI, the trends are evolving faster than ever. 

First-time founders now potentially have the “unfair” advantage we have been debating. AI is moving fast enough that prior mental models can be a liability as much as an asset.

As an example, earlier in the software world, a single product to build a strong wedge was seen as a sign of focus. Now first-time founders are questioning the norm by building multiple agents within a vertical to “land grab” workflows across sectors and with much smaller teams. In the US, of the 40+ companies that were founded in the last five years and have already achieved unicorn status, 95% were led by first-time founders.

Further, younger founders don't have to unlearn and tend to run leaner. Among the top 100 AI companies globally, the median founder age is 29, compared to 34 for historical SaaS startups.

We are at an incredibly interesting time to see how this shapes up with the current pace of technology and as India matures as a market.

After 19 years in this ecosystem, we are certain that there is no single "winner" archetype. A seasoned founder brings proven operational velocity and networks, while a first-time founder brings clean slate thinking and urgency.

While repeat founders have demonstrated more success in the past, new technology balances this bias out more than ever. As an investor, the goal is to identify the hunger, agility and scalability in the room. The real game for us is in recognising when each advantage matters the most.

(Rahul Chowdhri and Aishwarya Makkar, Stellaris Venture Partners.)

Views are personal, and do not represent the stand of this publication.