(The Weekend Insight) - The ERP-ification of Indian Startups: When Speed Meets Structure

In today’s deep-dive we explore a transformation that sneaks up on Indian startups right after they raise their Series A or Series B - the moment the company stops feeling like a scrappy rocket ship and starts behaving like an institution. The shift begins quietly: a finance controller joins, HR introduces structure, legal asks for documentation, and suddenly the company that once shipped features overnight now debates them over three meetings. This is the ERP-ification of Indian startups - the slow, necessary, and sometimes painful replacement of hustle-led speed with process-led stability.

Through this report, we will explore the moment every fast-growing Indian startup fears but can never outrun: the day the organisation stops behaving like a hungry insurgent and starts acting like a regulated institution. One quarter you’re shipping features at midnight and scaling cities on instinct; the next quarter you’re discussing SOC 2 gaps, GST reconciliations, and privacy audits. The hustle that built the company suddenly collides with the systems needed to sustain it. What begins as a few “must-do” processes quietly snowballs into a full-blown operating reset - the ERP-ification of Indian startups.

Before Zepto became the dark-store machine it is today, the company operated on chaos. In the early days, store managers updated inventory on WhatsApp, replenishment was based on gut feeling, and delivery zones were expanded or shrunk by whoever was available at 2 a.m. But once Zepto hit scale, chaos stopped being charming - it became expensive. The company implemented ERP-like discipline: automated inventory reconciliation, shrinkage dashboards, forecasting engines, routing optimizers, and SKU-level margin tracking. What was once "move fast and pray" became "move fast only when the system agrees."

Razorpay’s evolution tells an even sharper story. In 2017, the company was a code-first engineering shop. Features were released quickly, bugs were patched later, and compliance was something the team dealt with only when the RBI called. But by 2022, after multiple rounds of regulatory tightening, Razorpay had built a 200-person compliance, risk, and security team. Every release required data-flow diagrams, privacy assessments, and SOC 2 alignment. Razorpay didn’t slow down because it wanted structure - it slowed down because the cost of non-compliance had become fatal.

Udaan experienced ERP-ification at the warehouse level. In its first few years, the B2B marketplace scaled rapidly on spreadsheets and aggressive sales hiring. But warehouse chaos - missing inventory, repeated stockouts, and manual reconciliation - wrecked margins. Post-2021, the company adopted a full ERP stack: barcoding, automated inward-outward workflows, seller scorecards, and reconciliation requirements. Sales velocity didn’t change dramatically - but the cost structure did.

Mobility startups like Ola went through a similar transition. In the early years, drivers were onboarded in groups, documents were checked manually, and incentive payouts were reconciled retrospectively. But as the company grew, regulatory scrutiny intensified. Ola had to adopt automated KYC systems, route-optimizing engines, compliance logs, driver scorecards, and safety dashboards. ERP-ification in mobility wasn’t a choice - it was the price of being allowed to operate.

D2C brands like Licious and Country Delight learned that early-stage chaos simply doesn’t scale. Licious’ early operations involved manual quality checks, WhatsApp-delivered QC updates, and ad-hoc delivery schedules. Once the company crossed ₹150-200 crore ARR, it needed SKU-level costing accuracy, temperature-controlled logistics workflows, automated replenishment models, and plant-level compliance audits. The company became more predictable - but also slower.

This is where Indian startups feel the friction most strongly: structure protects scale, but it dilutes speed. Engineers who once shipped features at midnight now submit PRDs, join reviews, and wait for sign-offs. Operations teams that relied on instinct now must record every action. Sales teams that thrived on improvisation now log CRM updates, track funnel hygiene, and report on pipeline accuracy.

We think the tension is not between old culture and new culture - it is between surviving and scaling. Structure slows you down, but chaos eventually kills you. Indian startups hit this trade-off earlier than Silicon Valley because:

• compliance is heavier,

• regulators intervene sooner,

• enterprise customers demand documentation,

• investors expect governance by Series A,

• and the market punishes mistakes quickly.

A US startup might adopt ERP systems at $20 million ARR. An Indian startup hits the same wall at $3-5 million ARR.

ERP-ification changes founders the most. The founder who once took decisions in an hour now juggles finance reviews, compliance escalations, hiring loops, investor updates, and cross-functional meetings. The instinctive scrapper must become an operator - someone who thinks in systems, not hacks. Some founders evolve. Some burn out. Some step aside.

But ERP-ification also introduces new resilience. When done right, it prevents audit blowups, accounting irregularities, privacy violations, chaotic scaling, and culture implosions.

The companies that scale well don’t reject ERP-ification - they learn to keep speed alive inside it. They build “fast lanes”: tiger teams, pilot pods, experimental zones, founder-led squads that bypass bureaucracy.

In 2019 and 2020, Meesho’s growth engine ran on the energy of small sellers, WhatsApp groups, and influencer-led demand. QC was loose, cataloging was inconsistent, return rates shot up, and sellers could relist products without accountability. Growth looked explosive, but every month exposed new operational leakage. By 2021, Meesho couldn’t rely on “trust-based commerce” anymore. ERP-ification arrived like a system shock: automated QC, seller scorecards, catalog audits, SLA monitoring, contribution-margin frameworks, and a central control tower that monitored every node of the marketplace. The company became slower, but also more real. Inquiries became conversions, returns stabilised, and contribution margin moved from negative to a path toward zero and beyond.

PharmEasy’s transition was triggered by legitimacy — specifically, the scrutiny that comes with being a healthcare business. In its early years, partner pharmacies uploaded inventory sheets manually, prescriptions were inconsistent, and the supply chain was fragmented. But once PharmEasy hit scale and regulatory pressure increased, the old model fell apart. ERP-ification arrived in the form of batch-tracking systems, automated GST reconciliation, procurement audits, verified suppliers, and cold-chain workflows. The systems slowed the organisation down, but they also professionalised it, and kept it alive.

OYO represents the most extreme case of ERP-ification under distress. In its hypergrowth phase, OYO onboarded hotels faster than any internal system could track. Contracts were updated manually, payouts were delayed or mismatched, and partners often complained about incorrect reconciliations. After a series of public governance failures, OYO rebuilt itself around structure: automated reconciliation engines, property-performance scoring, audit trails for every payout, occupancy dashboards, fraud checks, and compliance workflows. A company famous for speed was forced into structure for survival.

Across all these examples, the pattern is the same: the tools changed the culture. Before ERP-ification, the startup runs on heroics - the salesperson who closes a massive deal with no CRM entry, the engineer who deploys a feature over the weekend, the operations manager who solves a citywide problem through instinct and social capital. After ERP-ification, heroics matter less than visibility. Documentation matter more than improvisation. Predictability trumps personality.

For employees, this shift feels like a loss. Early hires miss the chaos. Mid-level operators from corporates finally find home. Newly hired leaders introduce structures that suffocate the earliest team members. Meetings increase. Autonomy decreases. The founder who once solved problems in minutes now needs alignment across finance, HR, legal, and compliance.

But this cultural tension hides a deeper lesson: speed is not the opposite of structure. Speed is what structure protects at scale. Zerodha ships fast because systems are tight. Razorpay experiments fast because compliance is airtight. Zepto innovates fast because operations don’t collapse.

ERP-ification is not a sign of loss. It is a sign of evolution. The goal is not to eliminate chaos - it is to contain it. The companies that attempt to run entirely on process lose agility. The ones that run entirely on hustle collapse. But those that learn to balance both are the ones that will define India’s next decade of growth.