Nikhil Kamath: Indian Founders Must Scale Up and Accept Failure

Zerodha co-founder Nikhil Kamath told the NDTV World Summit in Delhi that Indian startups cannot fairly compete with their American and Chinese peers unless the country expands its pool of risk capital and stops treating failed ventures as a social stain.

The 40-year-old investor was blunt about the math. "I was in China for a month earlier this year. They have a lot more capital, risk capital at hand, to experiment and try different things," he said. "I don't see how an Indian company, or for that matter any company outside of those two or three countries where there is that much risk capital, can have a fair shot at competing in that layer. It would be really hard. I think the odds are low."

That framing invites pushback. Kamath is no armchair critic. He has personally written checks into at least five Indian consumer and mobility names — electric scooter maker Ather, meat retailer Licious, supplements brand Nourish You, hygiene firm Pee Safe, and bakery-café chain Subko. The portfolio argues that Indian founders can build at scale. The speech argues the country is structurally outgunned. Both can be true, and Kamath did not reconcile them on stage.

What does Kamath want Indian founders to do?

He wants them to swing harder. "We do think Indian entrepreneurs should really be thinking about, or trying to, scale at that level," Kamath said. "Culturally in a lot of places that are being very innovative, somehow when these guys fail society does not look down upon them. Maybe that's something we need to inculcate here."

The qualifier matters. Kamath is asking founders to attempt large outcomes. He is not, here, asking the government for anything specific. The policy prescriptions arrived in the next exchange.

What is the China lesson, exactly?

Kamath leaned on a piece of 1990s Chinese economic history. In the early reform years, Beijing ran what he called an "Amnesty programme." Failed entrepreneurs paid a fine and were then encouraged to start over.

"When an entrepreneur tried something and failed, he kind of had to pay a fine and they got him back to start working right away and try again. They really pushed him to do it," Kamath said. "I think culturally and more so from a policy standpoint, we need to inculcate that somewhere."

Kamath did not explain how the Amnesty programme translated into the venture capital density he now sees in China. The link between the two is one he asserted, not one he demonstrated. His point about faster re-entry after failure stands on its own; the historical case study does less work than his phrasing suggests.

He also flagged selective endorsement. "I don't align with everything that China is saying," he said, "but some things we can definitely pick up." That hedge carries more weight than the headline, given that Kamath did not specify which Chinese policies he would import and which he would not.

How big is the capital gap, by his own read?

Kamath did not put a dollar number on it. He framed the gap as structural: only "two or three countries" carry the risk capital required to compete at the frontier. He spent a month in China earlier this year and returned convinced the asymmetry is widening.

"Risk capital" in his usage is the patient, loss-tolerant money that funds multi-year bets before revenue materializes. Kamath did not name which "two or three" countries he had in mind beyond the United States and China. India's own startup capital pool — he did not quantify — is left implied as smaller.

What is Kamath's standing in the room?

Kamath co-founded Zerodha, a stockbroking firm widely counted among India's largest. He is a school dropout. The biography gives his failure-tolerance message a credibility he could not buy with money.

His portfolio list is the harder data point. Ather, Licious, Nourish You, Pee Safe, and Subko are all consumer-facing, capital-intensive businesses. He is asking founders to take the kind of swing he has already taken with his own capital. That is the most useful line in his remarks, and he did not actually say it: ambition costs something, and he has paid it.

The takeaway for founders is honest if uncomfortable. India can produce founders willing to fail. The country's risk capital, by Kamath's own diagnosis, is not yet large enough to absorb that failure at the scale he is asking for.