Mamaearth IPO Dilemma: To Proceed or Pause

Mamaearth was founded by husband-and-wife duo Varun and Ghazal Alagh in 2016. The core value proposition of Mamaearth's offer focused on toxin-free, safe products based on natural ingredients, which resonated strongly with its target audience. Despite operating in a tough and competitive industry with many large, established global and Indian companies, Mamaearth had been able to build a strong presence in the market and achieve unicorn status in 2022. One remarkable aspect of the firm's growth had been that it was one of the few unicorns that-along with strong top-line growth-had a positive bottom line and had turned profitable in the previous two years. This early success gave founders and investors the confidence to plan their next move, which was to issue an initial public offering (IPO) at a valuation of $3 billion in 2023. But the IPO was planned at a time when there was a marked downturn in funding in the start-up ecosystem. Further, the post-listing performance of some of the other celebrated unicorns had been less than satisfactory, resulting in heavy losses for investors. Therefore, many unicorn firms that had been planning IPOs had deferred their plans. Facing the possibility of such a poor scenario, should Mamaearth move ahead with its IPO, defer in anticipation of a more opportune time, or find alternative means of raising funds?

• Branding
• Entrepreneurial finance
• Venture funding
• Start-ups
• IPOs