'Promoter' tags make a comeback as startup founders look to rewrite IPO playbook

Our Founder and MD, Mr. Shriram Subramanian, recently quoted on Moneycontrol.com, sharing his insights on the evolving trend of startup founders embracing the promoter tag ahead of public listings. This shift signals a strategic change in India’s startup IPO ecosystem, where founders are increasingly reasserting control and sending stronger commitment signals to investors.

Earlier IPOs, such as Paytm, Zomato, Swiggy, and FirstCry, often opted for “promoter-less” structures to avoid regulatory lock-ins. Today, founders are reclaiming the promoter tag to consolidate strategic control. This move is influenced by SEBI’s regulatory relaxations, decreasing founder stakes in unicorns, and growing investor expectations for clear leadership accountability. Promoter status now acts as both a signal of commitment and a tool to maintain the “driver’s seat” amid dilution from PE/VC funding.

Mr. Shriram Subramanian noted that there is “definitely some investor pushback” because investors expect founders to have “skin in the game.” He explained that the primary consideration for founders when deciding whether to identify as promoters is liquidity. If they are willing to wait a couple of years to sell, it makes sense to do so as promoters. He added that investors are asking tougher questions of founders and investment bankers, which has led bankers and lawyers to advise founders to take on promoter status.

Read the full article: https://www.moneycontrol.com/news/business/startup/promoter-tags-make-a-comeback-as-startup-founders-look-to-rewrite-ipo-playbook-13587216.html