Ronnie Skruvala: No funding winter for startups with real business models

New Delhi: Ronnie Screwvala, co-founder and chairman of higher education platform upGrad, said there is no winter of funding for startups and unicorns with great and real business models, and for those who build to outlast all others.

In an interaction with IANS, Screwvala said that even today, with the world facing enormous uncertainty from multiple macroeconomic factors, investments in multiple industries are closing on a daily basis.

The following are excerpts from the interview:

Q: What do you think of the current wave of “funding winter” in India?


A: I always find it funny to hear the term “funding winter”, which I’ve heard a lot over the past 15 years. I always thought that only God was responsible for the multiple seasons we enjoy each year, but recently, the private equity (PE) investor community is replacing this with their own seasonal patents.

Summer is when you revel in your self-made glory, excess and overvaluation, no one is in charge and everyone is told to make hay when the sun is shining.

Monsoons (unique to India) are the realization of “the downpour when it rains” – for better or for worse.

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Then, winter of course, it’s time to rewrite the same 50-page presentation that was the exact opposite of the summer months — time to reverse the same capital raising, valuation, and supposedly super-so-called growth intoxication. Once’ write and blame the whole world, wars, inflation, etc., lurking all summer long, but no one wants to wear their glasses.

Seriously though, there is no funding winter for companies with great and real business models and for those who are built to outlast all others. Even today, investments in multiple industries are closed every day — perhaps not by investors who might be mavericks.

Let’s face it, the market has corrected 10-12% and that’s it. Overall, it’s still much higher than it was before Covid, and if you look, many companies are at all-time highs. This is also the perfect time for real businesses and established founders to not inflate valuations.

Every valuable company has to go through multiple seasons over and over, and the right company grows and matures from it.

Also in winter, the most graceful snow leopards come out to hunt and become predators, so winter is the time for those who want to build longer and want to become predators.

Q: The edtech industry is laying off jobs. Is this because funds are drying up or is there something more?


A: There is absolutely no “drying out”. Just because a handful of startups got crazy funding, lost all focus, were pushed to grow and diversify, and are now being forced to wake up and smell coffee by these investors, doesn’t mean there’s any dry spell .

They were misled by themselves and their boards and are now correcting themselves, unfortunately at the expense of valuable work colleagues, but they are the exception, not the trend at all.

In 100 years of education and “lifelong learning”, there has never been a more opportune time to break the scale and allow millions of college learners and working professionals to re-invent, re-skill and build on their careers Embark on a new path of growth. India is also well positioned to open up the higher education market in Asia and around the world.

At upGrad, we move away from distracted hubris and focus on outcomes and career impact.

Don’t get me wrong, there has never been a better time. K12 has weathered the Covid shock and is now seeing a much-needed correction, but most edtech companies are just getting started.

Q: How do you see the global macroeconomic conditions sweeping the global economy?


There were some interesting themes over the three days at the World Economic Forum (WEF) in Davos. Here are some key points:

A) Those who question the end of globalization don’t really spend enough time defining what it means before sounding the death knell. Globalization is here to stay, as the world’s consumers have hoped. Zayda, 18, from Bangladesh wants to own an Apple iPhone, and Amari, 22, from Zambia, wants to graduate from a UK university.

While world leaders have created obstacles in their own way, through war or the threat of war and more isolated growth, the more than 7 billion people on this planet will not let that happen and globalization will prevail.

B) A reskilling revolution is taking place and will sweep the world over the next decade. Better education and lifelong learning – accessible and affordable to all – digital can and will add $8 trillion to global GDP this decade. Power shifts across countries will be based on the workforce and its populations preparing for the jobs of tomorrow, while also being the learning capital of the world.

C) India also has the place and standing to be the new voice of global leadership – the largest democracy, fastest growing economy and a world leader with a clear, conviction and agenda to put it centre stage in the world.

D) There is no doubt that the world will go through a very, very challenging period. Because of the disproportionately high proportion of the world’s food supply, the poor will get poorer even if the rich don’t get richer. Instead of leaving the planet in a hurry, Covid has put us all on high alert for our health, even noticing monkeypox – a disease endemic in Africa for years, but not since it hit the “Western” world.

The war is not going to end anytime soon, and it will be interesting to see how the West stays engaged or loses interest if it doesn’t fit their agenda as it drags on.

The big question we still need to track is how polarized the world will be in the next two or three years. All of this requires incredible world leaders and political leadership and building businesses and organisations.