The push and pull factors behind leadership exits in Indian startups

PharmEasy founders Dhaval Shah, Dharmil Sheth, and Hardik Dedhia recently announced their plans to step down from their day-to-day roles at the e-pharmacy giant to launch a new venture in the consumer space. Their exit is part of a larger trend that defined India’s startup ecosystem in 2024 — a wave of high-profile leadership departures across co-founders, chief executive officers, and chief experience officers (CXOs).

 

The reasons behind this shift are multifaceted, driven by entrepreneurial ambitions, greater talent mobility, a growing acceptance of shorter tenures, and mounting regulatory and corporate governance challenges.

 

Some of the prominent leaders who stepped down include Udaan’s co-founder Amod Malviya, who announced plans to start Pre6, while Mayank Kumar launched BorderPlus after exiting his role as co-founder and managing director of UpGrad.

 

When asked if leadership resignations had surged in 2024 compared to the previous year, management expert Shailesh Haribhakti affirmed the trend. He pointed to two key drivers: a rise in initial public offerings (IPOs) among small and medium-sized businesses, which encouraged entrepreneurs to strike out on their own, and an intense war for top talent as companies sought seasoned CXOs to lead their businesses.

 

Padmaja Ruparel, co-founder of Indian Angel Network, highlighted how financial security and experience fuel these transitions. “Employee stock ownership plans have created wealth for many leaders, giving them the financial cushion to take risks. They’ve also gained valuable insights into startup operations, market gaps, and challenges, making them well-equipped to build new ventures,” she explained.

 

Investor sentiment has also played a role in this leadership churn. Angel investor Lloyd Mathias observed a spike in founder and CXO exits, driven by a slowdown in funding and unicorn creation, as well as regulatory and governance concerns.

 

According to market intelligence firm Tracxn, India produced just six new unicorns in 2024, a steep drop from 24 in 2022. Despite total startup funding rising to $11.4 billion in 2024 from $10.9 billion in 2023, the investment landscape remained volatile.

 

Sanjeev Bikhchandani, co-founder of Info Edge, observed that financial downturns often trigger leadership changes. “Whenever capital ebbs a bit in companies or industries, whether it’s a slowdown in terms of sales or funding, there is often a churn, and that’s a natural tendency,” he said.

 

Yet, not all departures stem from external pressures.

 

As funding slowed, startups sought to attract senior talent from established companies by matching salaries and offering lucrative stock options.

 

Cultural shifts have also played a role in the increasing fluidity of leadership. Haribhakti pointed out that while previous generations valued long-term job stability, today’s leaders are more open to frequent career moves. However, Mathias warned that excessive churn could be a red flag for investors.

 

“Whenever there is a series of exits in a short interval, it prompts investors to question the promoter or the founder's style, as the CXOs who are leaving have a better sense of the business’ robustness and the founder’s maturity in terms of having a team,” Mathias said.

 

Beyond product-market fit, institutional and global investors prioritise corporate governance, and early leadership exits can signal deeper issues. As India’s startup ecosystem matures, companies must strike a balance between entrepreneurial ambition and organisational stability to sustain long-term growth.

   

Company	Founder/CXO	Reason to leave
Byju's	Arjun Mohan	External advisory role
Flipkart	Binny Bansal	Launched a new startup, OppDoor
Greg Moran	Zoomcar	Angel Investor; Mentoring early-stage startups
Paytm	Surinder Chawla	Benett-Coleman
Zomato	Akriti Chopra	Not known
Bharatpe	Suhail Sameer	Venture Capital fund
Ola	Hemant Bhakshi	Not known
Udaan	Amod Malviya	Launched a new startup Pre6
UpGrad	Mayank Kumar	Launched BorderPlus
Adda24	Chandan Singh	Not known

  Source: Media reports and company releases