Second coming: How India's first generation of consumer internet founders is building again

For almost two years, the work remained known only to a small circle of people.

There were no product announcements, fundraising rounds or launch events. The work began at Continue Research, which describes itself as “neither a company nor a start-up”, but a research organisation. It was trying to answer a simple question: if the human body is a system, where are its most important leverage points? The research focused on ageing, cerebral blood flow and the biology of longevity.

Then, in November last year, Deepinder Goyal appeared wearing a small metallic device clipped to his right temple.

Doctors questioned the science while biohackers speculated about what it measured. Eventually, Goyal revealed that the device—Temple—had grown out of Continue Research’s work on ageing and that he had been wearing prototypes for nearly a year.

In the months since, Temple, still very much in development, has expanded its invite-only testing programme to around 100 volunteers. Investors have committed $54 million (around Rs 500 crore) to the venture, including $11.5 million from Goyal himself, valuing it at $190 million.

The fundraise came just weeks after Goyal stepped down as the Chief Executive Officer and Managing Director of Eternal, the parent company of Zomato and Blinkit, which he co-founded in 2008.  

Temple is an unlikely second act. The founder who spent nearly two decades building one of India’s defining consumer internet companies is now trying to build a neuroscience company. But Temple isn’t the only thing Goyal is building.

Last year, he also co-founded LAT Aerospace, an aviation venture aiming to transform regional connectivity in India using autonomous, hybrid-electric aircraft designed for short runways. In February this year, it acquired Gurugram-based defence robotics start-up Sharang Shakti.

Goyal declined to comment on this story. However, he has said in previous interviews that he briefly experimented with what he called an “unpurposeful life.”

“It was enjoyable for a few months, but at its core it was shallow and hollow, and it wasn’t for me. So, I came back to work,” he said.

Goyal is part of a growing group of first-generation tech entrepreneurs who are rolling up their sleeves again and starting something new—something very different. Aman Gupta, after building boAt, is now working on OffBeat Studios, a talent management and creative agency. In April, it raised Rs 100 crore in seed funding led by Bessemer Venture Partners at a Rs 450 crore valuation. Mukesh Bansal has made a similar move. After building Myntra and Cult.fit for consumers, he is now building enterprise artificial intelligence (AI) start-up Nurix AI, selling to other businesses. Gupta declined to comment on this story. Bansal and Anant Vidur Puri, partner at Bessemer Venture Partners, did not respond to requests for comment.

PharmEasy co-founders Dharmil Sheth, Dhaval Shah, Siddharth Shah and Hardik Dedhia are building AllHome. In June, AllHome raised Rs 200 crore from Bessemer Venture Partners in a Series B round at a reported valuation of Rs 2,000 crore.

Different sectors. Different technologies. Entirely different business models.

Taken together, these second acts point to a broader shift. Some of the founders who built India’s first generation of consumer internet companies are starting again, with businesses that bear little resemblance to the ones that made them successful.

Changing times

“If I were starting up today, I probably wouldn’t build PharmEasy,” says Sheth. “We spotted a gap in 2015 and built a health-tech platform connecting consumers, retailers, distributors, and manufacturers. Between a few competitors and us, the access-and-availability problem is now largely solved,” says Sheth. “If I were starting today, I’d build a highly differentiated product that stays at the top of the supply chain.”

The playbook that defined India’s consumer internet boom no longer offers the same rewards. The markets that produced the country’s first generation of unicorns are larger than ever, but also far more competitive and dominated by companies with scale. Many of the biggest categories have consolidated, leaving far less room for challengers than they did a decade ago. Competing today is less about spotting an unmet need and more about achieving scale.

Take food delivery. In 2015, more than a dozen companies—including Zomato, Swiggy, Foodpanda, TinyOwl, Roadrunnr and Ola Cafe—were battling for market share. Today, the category has largely consolidated into a duopoly. Similar patterns are visible across much of the consumer internet.

Abhiram Bhalerao, partner at venture capital firm V3 Ventures, has watched this shift play out across the founders and brands he backs. “It’s impossible to build another food-delivery platform or another electronics-first marketplace,” he says. “Consumers already have dozens of apps competing for attention. Unless a product offers something meaningfully different, persuading them to download one more has become increasingly difficult.”

Customer acquisition costs have risen in tandem. “When companies such as boAt and Mamaearth were scaling five-six years ago, relatively few brands were targeting the same customer with similar products,” says Bhalerao. “Today, for every category, at least ten brands are competing for the same customer at a similar price point.”

The opportunity set has expanded as well. A decade ago, consumer internet attracted most of the capital, talent and entrepreneurial energy. Today, founders can plausibly build venture- scale businesses in enterprise software, manufacturing, industrial technology, deeptech and specialised research. Some of these categories—spacetech, for example—were closed to private capital a decade ago.  

That shift in market conditions is only part of the story. Years spent creating, scaling and exiting businesses leave entrepreneurs with capital, conviction and a different appetite for risk. For Kunal Khattar, a serial entrepreneur and founding partner at VC fund AdvantEdge, that shift often begins with ambition.

“They’re independently wealthy. They’re not doing this for money,” says Khattar. “At that point, usually bigger questions, like a new challenge or motivation, take over.”

For many second-time founders, difficulty is part of the appeal. Goyal has called the odds of LAT Aerospace succeeding “99.9% impossible.” Those odds are precisely what make the problem worth pursuing.

But it is not just about ambition, bravado or restlessness. These founders are acutely self-aware. They know what they bring to the table, and what they don’t. They also understand that a company requires different capabilities at different stages of its evolution.

“The skill set that takes a business from zero to one, one to ten, and ten to a hundred is very different from the one that takes it from a hundred to a thousand,” says Khattar. “Many founders realise they’re neither the best people to lead into the next stage of growth, nor do they actually want to spend the next ten years doing it.”

Sheth sees it through a different lens. The mistake, he argues, is assuming entrepreneurs belong to industries where they first found success. “Every founder identifies a problem and commits 100% to it,” he says. “Nobody’s married to an industry.”

He points to India’s family-owned business groups, many of which have spent generations moving across retail, pharmaceuticals, automobiles, manufacturing and financial services as opportunities evolved. Start-up founders, he believes, are beginning to think the same way. “It’s not about the sector,” says Sheth. “It’s about spotting a problem and going after it with everything you understand.”

Not everyone attributes this evolution solely to changes within the founders themselves. “Why now would be largely the market—the funding environment, the technology available, or some change in the regulatory window,” says Sajith Pai, partner at Blume Ventures.

Consumers, meanwhile, have evolved as well. As incomes have risen, premiumisation has gathered pace, and many customers are willing to pay more for better products, prioritising quality over price. Bhalerao says founders who spent years building consumer brands have watched that shift unfold in real time. “Some of the products they were selling to the consumer in 2018 or 2019 just don’t make the cut in 2025 or 2026,” says Bhalerao.

For experienced founders, the question is no longer whether another consumer category can be built. It is where to build next—and that destination looks very different from a decade ago.

The evolution

India’s start-up ecosystem has evolved in various waves. The outsourcing boom established India as an engineering powerhouse, while improving internet access, smartphones, digital payments and abundant venture capital created the consumer internet boom of the late 2000s and 2010s. Flipkart, Zomato, Paytm and Myntra emerged during this period, while Reliance Jio’s launch in 2016 dramatically expanded the digital market.

For the better part of a decade, consumer internet offered some of the country’s biggest entrepreneurial opportunities. Every friction point—from discovering products and ordering food to booking cabs, making payments and buying everything from cosmetics to insurance—looked like a start-up waiting to be built. Many went on to define entirely new consumer categories.

“When Flipkart started, the internet was still evolving,” says Satish Meena, founder of research platform Datum Intelligence. “People first came online to consume content. Then they started shopping. Then came everything else.” The market wasn’t big enough, and the technology wasn’t ready. “Now all three things are in place—the technology is ready, these founders have built their own brands, they have access to capital, and there is a massive customer base willing to pay for these things,” says Meena.

That foundation is what has made these second acts possible. “Each generation builds upon the shoulders of the other,” says Pai. “This generation of apps benefited from the work done by the first and second generation of internet start-ups in laying down distribution and payment rails and building trust around e-commerce usage.”

New frontiers

Early interest from investors suggests they are betting as much on experience as they are on ideas.

Temple has so far raised $54 million in a round funded by friends and family, Nurix AI $42 million across three rounds, AllHome around $40 million across equity and debt, and OffBeat Rs 100 crore in seed funding. Some of them are still pre-revenue and may not succeed. Still, venture capitalists are committing far larger cheques, and much earlier, than they typically would to first-time founders.

“These new businesses are riskier than consumer businesses, but investors are willing to back them because they have proven themselves once,” says Meena. It helps that the founders themselves have skin in the game, and what investors are really backing is a decade or more of pattern recognition.

PharmEasy’s Sheth says that even though AllHome seems like unfamiliar territory, the operating model behind the new venture is the same PharmEasy. “PharmEasy let us build B2C, B2B, B2B2C, a large diagnostics platform and SaaS businesses under one roof,” says Sheth. “It teaches you scale, and it teaches you what actually works across very different business types.”

Three lessons carried directly into AllHome: integrating acquisitions, using technology and automation to improve operations, and managing an organisation that grew to thousands of employees. AllHome, he says, is “essentially a refined version of the models that worked for us at PharmEasy.” Skill and execution are good but incomplete without perspective. Bhalerao says years spent building consumer businesses gave founders an unusually close view of how Indian consumers evolved. They watched incomes rise, brands premiumise and purchasing behaviour change.

“Let’s say you built a consumer electronics business. Years of working with manufacturers, branding agencies, packaging firms and creators have become a resource that can be deployed across multiple businesses,” says Bhalerao.

That accumulated knowledge is already being put to work. Mamaearth founders Ghazal and Varun Alagh have taken stakes in younger consumer brands, bringing operating experience alongside capital. Mukesh Bansal set up Meraki Labs, a venture studio focused on incubating AI and deep-tech start-ups, in 2020, on the cusp of what would become the decade’s defining technological shift.

Role of AI

Each era of entrepreneurship begins with a technological shift that changes the economics of building. The internet lowered the cost of distribution. Smartphones lowered the cost of access by putting computing in every hand. AI is now lowering the cost of creation itself.

“Earlier, you had an idea but thought the technology wasn’t ready for you to build it,” says Meena. “Now, a lot of spaces have opened because of AI. It has also fast-tracked the entire process.”

AI has compressed the journey from an idea to a working product. Data analysis has become dramatically cheaper, early versions of products can be built and tested far more quickly, and workflows ranging from demand forecasting and marketing campaigns to brand creatives and legal documentation can now move from a blank page to a workable first draft in a fraction of the time they once took.

Bhalerao likens AI to a “Day Zero employee,” a chief of staff that helps founders organise years of accumulated knowledge into repeatable systems. What once required months of sifting through presentations, customer feedback, operating manuals and internal documents can increasingly be done in hours.

“AI won’t solve for motivation or insight, but the cold-start problem has practically been reduced to zero,” he says. “Building a start-up from zero to one has become way more efficient.”

For entrepreneurs building again, the timing is especially significant. They are arriving at a moment when years of operating experience coincide with technologies that dramatically lower the cost of building while opening entirely new categories of business.

The last generation of internet start-ups proved India could build consumer internet companies at scale. The next generation is asking a more ambitious question: what else can India build?