In the last few years, we have seen many Indian unicorns and late-stage startups getting headquartered outside India. According to media reports, 24 unicorns either flipped or were incorporated abroad. Crypto and SaaS startups in particular have made the US, Singapore and the UAE their growth havens. The key factors pushing these startups to take the overseas leap are lower corporate tax rate regimes, zero capital gains tax rate, matured IP protection laws, and better regulatory clarity. Even though building for Bharat has been the passion of Indian entrepreneurs, many preferred pursuing that dream from outside India. For many, this allows them to publicly list overseas with higher valuations.
However, the trend seems to be reversing now. Startups are making India their domicile again. It all started in October last year with PhonePe moving its registered entity from Singapore to India. In fact, in January this year, Sameer Nigam, cofounder and CEO, PhonePe even said that at least 20 existing unicorns want to come back to India and domicile here. "They have reached out to us, if regulations get much easier," said Nigam during an YouTube Live Session. Fintech unicorn Razorpay is also moving its parent entity from the US back to India, according to an Economic Times exclusive report. Groww, another fintech unicorn, is also looking to shift, says a report by Entrackr.
GHAR WAPSI
As mentioned above, Indian Unicorns have been relocating their headquarters to Singapore, the UAE, and the US due to the attractive features of these countries, such as lower corporate tax rates, zero capital gains taxes, relaxed regulations, and simplified compliance procedures. Then why the reverse flipping now?
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