Ronnie Scrovala: There is no winter funding for startups with real business models

New Delhi: According to Ronnie Scrovala, co-founder and chairman of higher education platform upGrad, there is no funding winter for startups and unicorns that have great, real business models and for those who build organizations that stand out from others.

Interacting with IANS, Scrovala said that even today, there are investments that are closing daily across multiple sectors, as the world faces a great deal of uncertainty about many macroeconomic factors.

Here are excerpts from the interview:

Q: How do you see the current wave of ‘winter finance’ in India?


A: I’m always happy to hear the phrase “winter finance” which I’ve heard so often in the past 15 years. I’ve always thought that only God is responsible for the multiple seasons we enjoy each year, but more recently, the private equity investor (PE) community has taken this place with their own patent on Seasons.

Summer is when you enjoy your self-made glory, the excesses and intoxication of excessive ratings, where no one is responsible and everyone is asked for hay while the sun rises.

Monsoon (unique in India) is the realization that when “it rains, it rains” – good or bad.

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Then, of course, it’s winter, and it’s time to rewrite the same 50-page presentation that in the summer months said just the opposite — time to reverse the same fundraising, appraisals, and overgrowth poisoning with ‘once upon a time’ jot down and blame the world All of it, the war, inflation and more, it lurked all summer but no one wanted to wear their glasses.

Seriously, there is no funding winter for companies with great, real business models and for those who build organizations that outlast all other companies. Even today, there are investments that close every day across multiple sectors – perhaps not with the maverick investors that they might be.

Let’s face it, the markets have corrected 10-12 percent, that’s it. Overall, it’s still much higher than pre-Covid and if you look, many companies are at all-time highs. This is also the best time for real companies and mature founders who don’t get bloated with valuations to get out there.

Every company worth its worth has to go through multiple seasons, over and over again, and the right company grows and matures from that.

Also in the winter the most elegant snow leopards come out for hunting and predators, so winter is the time for those who want to build to last and want to be predators.

Q: The education technology sector is experiencing layoffs. Is this because funding has dried up or is there more?


A: There is absolutely no “dry spell”. Just because a handful of startups got insanely funded, causing them to lose all focus, and driven to grow and diversify, these investors have now forced them to wake up and smell a coffee, doesn’t mean there’s ever been a drought.

They have sinned themselves and their board and are now correcting themselves, unfortunately at the expense of their co-workers, but they are the exception, not the trend at all.

Never in 100 years of education and “LifeLongLearning” has there been a more opportune time to disrupt scale and engage millions of college learners and working professionals to reinvent, reskill, and embark on a new growth path in their careers. India has also been brilliantly positioned to open up the higher education market in Asia and around the world.

At upGrad we have moved away from the arrogance of distraction and focused on results and impact on functionality.

There must be no mistake, there is no better time than now. K12 has gone through the Covid bump and is now seeing a much-needed correction, but the majority of companies in education technology are just getting started.

Q: How do you view the global macroeconomic conditions that have engulfed economies around the world?


There were some interesting topics across the three days at the World Economic Forum (WEF) in Davos. Here are some tips:

a) Those who were wondering about the end of globalization did not spend enough time defining what that meant in the first place, before sounding the death knell on it. Globalization is here to stay what the global consumer wants it to be this way. 18-year-old Zaida in Bangladesh wants to own an Apple iPhone and 22-year-old Amari in Zambia wants to graduate from a UK university.

While world leaders have in their own way created barriers, through war or threats of war and further isolated growth, the seven billion+ people on this planet will not allow this to happen and globalization will prevail.

b) A reskilling revolution is taking place and it will be a tsunami for the next decade across the world. Better education and lifelong learning – accessible and affordable for all – digitally could add $8 trillion to global GDP in this decade. Power shifts will occur in countries based on the readiness of the workforce and their populations for the jobs of tomorrow and also to be the learning capitals of the world.

c) India is also well positioned and positioned to be the new voice of global leadership – the largest democracy, the fastest growing economy, a world leader with clarity, conviction and an agenda to put it center stage in the world.

d) There is no doubt that the world will go through a very difficult time. With food disproportionately available to countries all over the world, the poor will get poorer even if the rich do not get richer. Covid doesn’t leave the planet in a hurry, but it has us all alert enough to notice monkeypox – something that’s been prevalent in Africa for years but ever since it hit the “western” world.

The war is not going to end quickly and it will be interesting to see how the West remains involved as the war drags on or that they lose interest if their agendas are not served.

The big question that we also need to track is how polarized the world will be in the next two or three years. All of this will require outstanding global leaders and leadership in policy and in building businesses and organizations.

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