How Much Were India’s Top Ecommerce Founders Paid In FY22

From producing the second unicorn of the country to emerging as the most funded sector, India’s ecommerce space stands tall as one of the strongest pillars of the Indian startup ecosystem. In fact, many consider the birth of the B2C ecommerce marketplace Flipkart in 2007 as a turning point in the Indian startup ecosystem, inspiring many others to set up their own ventures.

Rising internet penetration, improving access to smartphones and the behaviour change induced by the stay-at-home mandates during the Covid-19 pandemic has led to a sharp increase in the number of online shoppers in the country. But this hasn’t translated into profits for ecommerce players as most of them continue to pile up losses.

However, mounting losses haven’t deterred the founders of these companies from withdrawing hefty paychecks. As per an Inc42 analysis, 32 founders of India’s 17 major ecommerce startups received annual remuneration of INR 49.83 Cr in FY22.

The median remuneration for these founders stood at INR 1.02 Cr in FY22, while they received an average hike of 17% from FY21. This was much higher than the average hike of 10.4% received by Indian employees in FY22, as per an EY report.

Notably, 10 unicorns, two listed ecommerce players, and five soonicorns were considered for this analysis. Ecommerce unicorns such as Moglix, Cars24, LivSpace, FreshtoHome, and Udaan were not considered as they have a parent entity in Singapore. Other ecommerce players were not considered for this analysis as they have not filed their financial statements for FY22 with the Ministry of Corporate Affairs or not disclosed the annual remuneration of founders.

The trend of founders of profitable startups taking home the highest salaries, which was seen in our earlier analyses of salaries of edtech and fintech founders, was visible in the ecommerce sector as well.

Six ecommerce startups out of the 17 considered for this analysis were profitable in FY22 and their 11 founders took home an aggregate salary of INR 19.1 Cr, 38% of the total salaries received by the 32 founders of the 17 ecommerce startups.

It must be highlighted that the above remunerations are the figures disclosed by the companies and may not be the only source of earnings for the founders. It is likely that some founders would have made money through secondary sales or companies might have taken care of some expenses of the founders.

Listed startup Nykaa’s MD and CEO Falguni Nayar earned INR 5.6 Cr in FY22, the highest among these founders. Despite this, her remuneration dropped 48% compared to FY21. 

In our earlier analyses, we found that Nikhil and Nithin Kamath, the founders of profitable bootstrapped unicorn Zerodha, earned INR 48 Cr each in FY22, the highest among fintech unicorn founders. MoneyView’s Puneet Agarwal and Sanjay Aggarwal had the highest remuneration among fintech soonicorn founders at INR 2.9 Cr each in FY22. Meanwhile, Physicswallah’s Alakh Pandey received the highest salary of INR 9.6 Cr among edtech founders.

Coming back to ecommerce founders, OfBusiness’ Asish Mohapatra received one of the lowest salaries at INR 26 Lakh in FY22, despite the startup posting a profit of INR 201.1 Cr.

On the other hand, Vidit Aatrey and Sanjeev Barnwal, founders of Meesho, which saw its net loss soar over 551.3% to INR 3,247.8 Cr in FY22, received the biggest salary hike of 155.5% each during the year. Aatrey and Barnwal received a salary of INR 2.3 Cr each in FY22 as against INR 90 Lakh each in FY21. This comes at a time when Meesho has laid off close to 700 employees since last year.

Founder Salaries: Which Sector Pays The Most?

Our earlier reports showed that the founders and CEOs of top 13 fintech unicorns collectively earned a salary of INR 133 Cr in FY22, while founders of top 15 fintech soonicorn startups cumulatively took home INR 31.2 Cr in FY22. Besides, founders of top eight edtech startups received INR 27.5 Cr in salary in FY22

Interestingly, at INR 1.02 Cr, the median remuneration for ecommerce founders was lower compared to that of edtech and fintech founders. While the median remuneration for fintech unicorn founders stood at INR 1.5 Cr in FY22, it was at INR 1.32 Cr for fintech soonicorn founders. The median remuneration of eight edtech unicorns stood at INR 1.13 Cr in the year ended March 31, 2022. 

Besides, the average salary hike of 17% received by the ecommerce founders was also lower compared to the hike received by founders of fintech and edtech startups. While fintech unicorn founders received an average hike of 40%, soonicorn founders got an average hike of 27% in FY22. Edtech founders received an average hike of 46% during the year under review. 

A Shaky Future?

The ecommerce sector has produced the highest number of unicorns in India – 24 out of 108 – and the startups in the sector have raised a whopping $33 Bn since 2014. However, like other sectors, the ecommerce space is also reeling under the effects of the ongoing funding winter. The funding raised by Indian ecommerce startups plunged over 63% to $4 Bn in 2022 from $11 Bn in 2021.

The trend of decline in funding continued in the first quarter of 2023 as well, with the ecommerce sector bagging $633 Mn, a decline of almost 67% from $1.9 Bn raised in the year-ago quarter. 

Then, there is the issue of profitability. Most of the ecommerce startups have so far failed to cap their losses. Amazon and Walmart-backed Flipkart, which dominate India’s ecommerce market, have also been unsuccessful in turning profitable in the country. 

Social commerce startups, which were a favourite of investors a few years ago, also failed to scale up revenue and control losses. This forced most of them to pivot to new business models. For instance, Meesho, which was the poster boy of social commerce in India, moved to B2C business. Besides, Indiabulls’ social commerce platform Yaari shut operations, while YouTube also pulled the plug on social commerce platform SimSim last month. Sequoia-backed Dealshare, which continues to operate as a social commerce player, saw its loss surge 543% to INR 431 Cr in FY22. 

As per Inc42 data, 39 loss-making ecommerce startups reported an aggregate net loss of INR 15,655.2 Cr in FY22.

Despite these troubles, ecommerce remains a promising sector for founders and investors. As per Inc42’s ‘State of Indian Ecommerce Report’, the ecommerce sector has the potential to grow to $400 Bn by 2030 and is expected to grow at a CAGR of 19% between 2023 and 2030. The number of ecommerce customers in the country is expected to soar to over 500 Mn by 2030.

Besides, the Centre’s ambitious Open Network for Digital Commerce (ONDC), which aims to establish a level playing field for all businesses and democratise the ecommerce sector by bringing small businesses offline, is also expected to lead to an increase in the number of online shoppers.

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