The top unicorns, shorthand for start-ups with valuations worth $1 billion or more, are the most acquisitive in India. They have surpassed the traditional technology companies in terms of acquisitions which means that these companies have used mergers and acquisitions (M&As) to expand rapidly in a brief period of time.
This is in contrast to traditional technology companies where such deals are far between and few. For Instance, Quickr, which is the most acquisitive unicorn in India, has made a total of 12 acquisitions since 2016, as per Tracxn, a technology data tracker. In comparison, Tata Consultancy Services Ltd (TCS), which is India' s largest tech firm, has made just 2 acquisitions, according to the data of Crunchbase.
" In the last four years, unicorns have been on an acquisition spree as they were busy raising capital. About 36 acquisitions have been made by five unicorns" , Livemint reported. In the year 2014, Flipkart bought Myntra for nearly $330 million, so last year when Walmart purchased Flipkart at a valuation of $21 billion, Myntra comprised of $5.5-6.5 billion of the deal value, making it one of the most successful acquisitions by a unicorn in India so far.
According to experts, start-ups such as Quikr, Flipkart, Paytm and OYO Hotels and Homes, tend to acquire more as their businesses are "consumer-facing" and depend on back-end technologies such as " artificial intelligence, machine learning, data mining" that further enhances the user experience.
(Edited by: Nehal Solanki)