Zomato listing to provide shot in the arm to startup ecosystem

The enthusiastic response to Zomato’s initial public offering (IPO) and the listing day surge is likely to act as a big boost to the startup ecosystem. Market players say the successful stock market debut will encourage venture capital and private equity investors to back more domestic startups. Further, it will motivate more unicorns, unlisted firms worth more than $1 billion, to resist the temptations to list in the US make their debut overseas.

The food-delivery company’s Rs 9,375 crore maiden offering was considered a test case for other tech and start-ups waiting in the wings to go public. Zomato’s IPOs drew bids worth Rs 2.1 trillion as it was subscribed 40 times. On Friday, the stock ended with a gain of 66 per cent.