When Good Glamm bought Sirona for ₹450 crore in 2024, it looked like another step towards building a consumer brands empire. Months later, Sirona’s founders bought it back in a deal reportedly worth ₹150 crore, including liabilities. Good Glamm, once valued above $1 billion, was running short of cash, while lenders moved against the brands it had acquired.

The story reflects a wider shift in who calls the shots at Indian startups. During the funding boom, founders had the upper hand. Venture funds competed to invest, valuations kept rising, and a founder unhappy with one investor could often find another. Investors tolerated heavy spending because fast growth promised a bigger valuation in the next round.

Now the balance has changed. When a company needs cash and few investors are willing to provide it, existing shareholders gain leverage. They can insist on lower valuations, tighter budgets, more oversight or leadership changes as conditions for fresh funding. Their agreements may also give them board seats, vetoes over major decisions and first claim on proceeds from a sale. Founders can still run daily operations, but important decisions increasingly require investor approval.

Byju’s shows how ugly that fight can become. Once valued at $22 billion, it ended up in insolvency proceedings amid disputes involving founders, investors and lenders. PharmEasy faced a different outcome. It raised $216 million in 2024 at a reported valuation of $710 million, almost 87% below its $5.6 billion peak. The business survived, but raising money at that price changed the balance of ownership.

Even a sale may leave founders with nothing. If preferred investors have a contractual right to recover their money first, a disappointing sale price can leave nothing for ordinary shareholders or employees. A study of 108 Indian venture-backed companies found that 75.9% of the agreements examined allowed vested founder shares to be bought back at cost or face value following termination for cause.

Investors are under pressure too. An IVCA-Crisil study found that only 13.9% of the venture fund schemes examined had returned their investors’ original capital by September 2024. A founder may want three more years to rebuild; an ageing fund may want an exit now.

Yet investors approved the spending and expansion they now question. India's startup ecosystem needs stricter financial discipline, but replacing unquestioned founder control with unchecked investor power would merely exchange one problem for another.

Let’s go through what else is happening in Indian startup world - Grab your simmering cup of StartupChai.in and unwind with our hand-brewed memes.

CCPA has penalized seven platforms ₹30 Lakh and removed 3,940 listings over unauthorised explosives sales.

The move tightens scrutiny of online marketplaces.

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Flipkart is eyeing an October-end launch for its food delivery service, Eat-in by Minutes, after expanding employee testing in Bengaluru.

The company has proposed a base restaurant commission of about 10%, below the 20%-25% typically charged by established platforms.

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OYO-parent PRISM plans to nearly halve its IPO fresh issue to ₹3,350 Cr from ₹6,650 Cr.

The company attributes the smaller requirement to stronger cash generation and an improving balance sheet.

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IndiQube Spaces will invest up to ₹35 Cr in SaiEdge Realty for a 49% stake.

The deal will help IndiQube lease office spaces developed by the new venture.

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