In February 2020, Virat Kolhi and Anushka Sharma joined Go Digit’s first external funding round.
Virat Kolhi and Anushka Sharma backed GoDigit, an online general insurance company opened for subscriptions today. The company is making its shares available in the price range of Rs 258–272. Interested investors can subscribe to the issue until Friday, May 17, with the option to bid for a minimum of 55 equity shares and in multiples thereafter.
However, here, the conversation is not about GoDigit. It’s about how celebrities turn into investors in start-ups. In February 2020, Virat Kolhi and Anushka Sharma joined Go Digit’s first external funding round. Anushka Sharma invested Rs 50 lakh to purchase 66,667 equity shares at the same price as Virat Kohli, who contributed Rs 2 crore to purchase 2,66,667 equity shares at a cost of Rs 75 each. At the Go Digit IPO price range of Rs 258 to Rs 272 per equity share, Virushka could potentially gain around Rs 197 per share on their investments.
When celebrities wear the cap of an investor in a start-up, their brand and influence automatically promote the start-up and increase their value in the public eye. This tendency, according to Kohli, is a huge benefactor to a brand, especially startup brands that need that boost to get a platform, as per an article by the Economic Times.
Other than the mass popularity that these celebrities have, what becomes important is the number of social media followers that they also have. Kohli, for instance, has 268 million followers on Instagram and 63.1 million on X (formerly Twitter).
The Indian cricketer has backed several other start-ups, such as food and beverage D2C brand Rage Coffee, fashion start-up Universal Sportsbiz, plant-based meat start-up Blue Tribe, and high-performance health brand Hyperice.
Kohli isn’t the only celebrity who has made substantial investments in the Indian start-up ecosystem. Recently, EV start-up EMotorad entered a partnership with former Indian captain Mahendra Singh Dhoni for an undisclosed amount. In addition to his new position as EMotorad's brand sponsor, his investment will include equity ownership in the company.
The former India team captain has invested in other start-ups such as drone start-up Garuda Aerospace, digital ledger app Khatabook, food and beverage company 7InkBrews, and an e-commerce platform for preowned cars, Cars24. In most of the start-ups, Dhoni joined both as a brand ambassador and an investor. It is interesting to see that celebrities want to both endorse the brand and want a share of the pie in the investment.
As per the New Indian Express, data from Tracxn shows that 73 start-ups have received investments from 28 celebrities, including Virat Kohli, Sachin Tendulkar, Anushka Sharma, Shraddha Kapoor, and Ranveer Singh, as of September 2023. While some celebrities were angel investors at a relatively young age, Tracxn data shows that numerous celebrities began actively investing in start-ups since 2020 and have taken part in 30 investment rounds in 2022 alone.
Deepika Padukone, Alia Bhatt, Katrina Kaif, Ranveer Singh, and the list goes on are some of the celebrities who invested in a wide rage of start-ups.
In September last year, Padukone invested an undisclosed amount in the homegrown coffee company Blue Tokai Coffee Roasters. Padukone has invested in other companies such as yogurt brand Epigamia, space tech start-up Bellatrix Aerospace, and more.
Some celebrities have seen their investments grow rapidly. In 2020, Alia Bhatt invested Rs 4.95 crore in the e-commerce company Nykaa. Bhatt's original investment had grown to Rs 54 crore by the time the firm was listed on November 10, 2021, a growth of approximately 11 times.
In 2018, Katrina Kaif launched a partnership with Nykaa called Nykaa-KK Beauty, starting with an initial investment of Rs 2.04 crore. During the time of the company’s listing, Kaif's investment had surged to Rs 22 crore, marking an impressive nearly 11-fold growth.
While talking about high returns received by celebrities, Amitabh Bachchan’s investment in Just Dial comes at the forefront. According to a filing in the company's red herring prospectus, Just Dial, which appointed Bachchan as its brand ambassador for a three-year term beginning on December 28, 2010, allotted 62,794 shares at a price of Rs 10 in 2011. At that time, the shares were valued at Rs 6.27 lakh; in 2013, that figure rose to Rs 6.6 crore.
With over 112,718 start-ups in 763 districts that have received DPIIT recognition, the Indian start-up ecosystem is the third largest in the world. No wonder celebrities do not want to be left behind in the rush towards the growing start-up ecosystem.