(The Weekend Insight) - Building a Startup Without Quitting Your Job: Rise of India’s Shadow Founders

In today’s deep-dive, we explore a quiet shift in India’s startup scene - where founders aren’t quitting jobs, just finding time. These shadow founders are salaried professionals at places like Razorpay or Zoho, building side projects at night on Notion and GitHub. They're not freelancing - they're launching real startups, quietly and deliberately. We unpack how they juggle careers and creativity, and why this model may reshape the future of Indian entrepreneurship.

It often begins with a whisper. Not a pitch deck, not a Seed funding announcement, and certainly not a founder's photo in TechCrunch. It starts at midnight, with a softly glowing screen and an idea that refuses to wait. Somewhere in Gurgaon or Koramangala, a salaried product manager is tinkering with a no-code dashboard. Elsewhere, a senior software engineer is pushing code to a GitHub repo labeled "test-project-23," a Chrome extension that summarizes legal docs using GenAI. Their bosses don’t know. Their HR policies forbid it. And yet, it’s happening quietly, obsessively, and relentlessly.

Welcome to the rise of the "shadow founder." These are India’s newest entrepreneurs, not college dropouts living on Maggi noodles, but salaried professionals with EMI burdens and two-screen routines. They have day jobs at Flipkart, Razorpay, or Zoho, and startups brewing in Google Docs after hours. They’re not moonlighters looking to make quick freelance cash. They’re builders. Founders in the making. And their tribe is growing.

This wave of shadow founders traces its roots back to the COVID-19 era, when remote work became mainstream. With laptops open in the privacy of their homes and minimal office supervision, some tech professionals began moonlighting - working two full-time jobs, often without their employers' knowledge. The idea was to double income while maintaining plausible deniability. This practice, while lucrative for some, led to a massive ethical and legal debate when it was exposed. High-profile IT firms like Wipro publicly terminated employees found engaging in undisclosed dual employment. The backlash forced a shift. Instead of risking their current jobs by secretly working for competitors, many professionals turned to something they could control - building startups. This pivot allowed them to apply their skills, retain autonomy, and reduce legal exposure, all while laying the groundwork for something they could own.

Over the last five years, India has quietly experienced the early signs of a foundational shift in how startups are born - with salaried professionals, side projects, and lean tools lowering the barrier to entry like never before. Once considered an all-or-nothing gamble, entrepreneurship is now often a gradual slide, a soft transition fueled by caution, tools, and necessity. This change didn’t happen overnight. It was initially shaped by COVID-induced remote work, then enabled by the proliferation of low-code and AI tooling, all driven by a growing mid-layer of professionals who have worked in hyper-growth environments and now want to lead something of their own.

Several of India's most iconic startups trace their origins to founders who were simultaneously employed. A notable example is Infosys, co-founded by Narayana Murthy while he was working with Patni Computer Systems. Flipkart, now an e-commerce giant, was founded by Sachin and Binny Bansal while they were employees at Amazon. Freshdesk (now Freshworks), which listed on Nasdaq, was established by Girish Mathrubootham during his tenure at Zoho Corporation.

The striking aspect of these examples is that the founders often operated in domains similar to their primary employers, highlighting the fine line between leveraging expertise and potential conflicts of interest.

Beyond these well-known giants, many other founders built their ventures from the ground up while maintaining their primary jobs. Saravana Kumar, a former IT employee, started building Kovai.co's first product, BizTalk360, while balancing a part-time role at Fidelity. He launched the refined version in 2011 and later transitioned to full-time entrepreneurship, growing Kovai.co into a multi-product SaaS company with global clients like BBC, Boeing, and Shell.

Abhinav Asthana, the founder of Postman, started building the API platform as a side project while working at Yahoo! and later consulting, before formally launching the company in 2014. Paras Chopra founded Wingify, a global software provider, after working as an R&D engineer for Aspiring Minds.

Nithin Kamath, the founder of Zerodha, India's largest stockbroker, began his entrepreneurial journey by trading during the day and working at a call center at night to fund his trading activities before co-founding Zerodha in 2010.

More and more professionals from sectors like fintech, edtech, healthcare, and logistics are joining the trend. Pallav Nadhani, the founder of FusionCharts, began building his data visualization software as a side project at the age of 16, operating it from his bedroom for the first three years while still a student. This bootstrapped venture grew organically before he formally scaled the company. Ramsri Goutham Golla, a former Microsoft employee, built Questgen.ai, an AI-generated quiz platform, as a side project. He developed it after collaborating with an EdTech founder and achieved significant monthly recurring revenue through this venture.

Natwar Agrawal, founder of the D2C footwear brand Bacca Bucci, started it as a side business in 2009 while earning a monthly salary. Harshit Singhal and Manali Sanghvi founded Hexafun, a lifestyle accessories brand, as a side hustle while working full-time as marketers at a leading company.

Unacademy began in 2010 as a YouTube channel where Gaurav Munjal, a software engineer, uploaded free educational videos as a side project. It was formalized as an edtech company in 2015.

But this raises a deeper psychological question: is building a startup in India seen as a hobby or a serious commitment? In Silicon Valley, the narrative has long been clear - start early, go all in. Founders are expected to launch companies straight out of college, often with no financial cushion, and investors reward that risk-taking. In India, the trajectory is different. Here, entrepreneurship is often delayed until one has built up a safety net. Many founders treat their first ventures as experiments. Some see it as a creative outlet. For others, it’s a side project that gradually demands full-time attention. The underlying cultural difference is significant: Indian society still prizes job security, and family expectations around stable income, marriage, and housing create additional psychological anchors. As a result, starting a company isn’t just about ambition, it’s also about negotiating risk with deeply ingrained social expectations.

This is also an area where the law isn't clear. Can someone work on a startup while holding a full-time job? Technically, Indian labor laws do not explicitly forbid side ventures. However, most private employment contracts include clauses around exclusivity, non-compete, and intellectual property. These contracts often state that any innovation developed while employed, even during personal hours, may belong to the employer, especially if it is related to the company’s line of business. This means that unless explicitly permitted, launching a startup in a similar domain could be a breach of contract. Some founders get around this by operating in entirely different sectors or by using proxies - setting up the company in a spouse’s or friend’s name. Others keep their startups informal until they are ready to quit. But the legality remains murky, and most founders walk a thin line between building quietly and violating company policy.

Another critical question: will investors take such part-time startups seriously? The answer depends. Traditionally, institutional investors have favored founders who are "all in" emotionally, financially, and operationally. The assumption is that only full-time commitment ensures focus and accountability. However, this mindset is beginning to shift. With the rise of operator-turned-founders and bootstrapped businesses proving traction before raising capital, some angels and early-stage VCs have become more flexible. That said, most investors still expect a formal transition to full-time leadership once funding is committed. Part-time ventures may earn initial interest, but serious capital typically arrives only when founders make the leap.

But this dual life is hard to sustain. Burnout is real. A 2023 Indie Hackers India survey found that 62% of shadow founders faced burnout symptoms within six months. One in four reported sleep issues or relationship strain. The grind of dual roles, especially when compounded with family responsibilities, can feel unsustainable. Founders try to cope through therapy, meditation apps, physical activity, or simply by blocking Sunday as a no-laptop day. But the toll is significant.

There’s also reputational risk. Being seen as “not all in” can hurt credibility. Some institutional VCs shy away from backing founders with day jobs, fearing signal dilution. Others worry about potential IP or conflict issues, especially if the startup operates in a similar space as the founder’s employer. This is why many shadow ventures stay small or under the radar until they’re undeniable.

Still, this model has undeniable upside. It de-risks entrepreneurship. It allows more people to try building. And it makes startups more inclusive, not only for the young or the well-funded, but for anyone with ambition, discipline, and a browser. For every Maya and Pratik (the Razorpay and PhonePe duo who built a loyalty plugin to Rs 1.5 lakh MRR), there are dozens more who are quietly building tools, plugins, courses, or D2C brands without quitting their jobs.

This trend is not a bug. It’s a feature of India’s evolving startup landscape. It reflects a workforce that’s tech-savvy, financially cautious, and increasingly creative. It shows that the founder archetype is expanding, from 22-year-olds in hoodies to 38-year-olds with school-going kids and SIPs. And it hints at a deeper cultural shift: the normalization of ambition beyond titles.

But for this model to scale further, we need systemic support. Corporates should relook at moonlighting policies, not with fear, but with nuance. Clear guidelines, conflict-of-interest disclosures, and intrapreneurship programs can offer win-win paths. Investors, too, must update their filters. Instead of dismissing shadow founders, they should assess traction, clarity, and grit. Governments should simplify regulations for new, small businesses to encourage them to operate legally, rather than burdening their growth. Government schemes like Startup India, the SIDBI Fund of Funds, and the Seed Fund Scheme could explicitly include shadow founders or part-time ventures under their eligibility.

There is also a broader cultural reset needed in how we view entrepreneurship. Failure shouldn’t be a badge of shame. Startups that don’t scale should still be seen as valuable experiences. Founders who return to salaried roles should be welcomed, not penalized. And most importantly, side projects should be treated as a legitimate expression of innovation, not a threat to loyalty. Encouraging this mindset shift will unlock creativity and productivity across all layers of the economy.

The shadow founder is here to stay. They may not always trend on X or announce their rounds on Inc42. But they’re building, quietly, cleverly, and consistently. Their stories don’t begin with a VC cheque. They begin with a question whispered at midnight: "What if I build this and see what happens?" And increasingly, they do.