Urban Company, a Gurugram-based home services platform, will open its 1,900-crore rupee (US$21.6 million) IPO on September 10, with a price band set at 98-103 rupee (US$1.17) per share and a valuation of up to 15,000 crore rupee (US$1.7 billion).

Early investors, including Accel India, Elevation Capital, Bessemer Venture Partners, Tiger Global, and Vy Capital, are expected to see returns ranging from 2x to 29x on their investments.

Vy Capital holds the largest institutional stake at 11.8%, followed by Elevation Capital at 10.8%, and Accel at 9.9%.

In the offer-for-sale, Accel, Elevation Capital, Tiger Global, Vy Capital, and Bessemer Venture Partners will each sell shares worth between 173 crore rupee (US$19.65 million) and 390 crore rupee (US$44.3 million).

Urban Company operates in beauty, wellness, and home repairs, and was founded in 2014.

The company reported FY25 operating revenue of 1,144 crore rupee (US$130 million), up 38%, and posted a net profit of 240 crore rupee (US$27.26 million).

.source-ref{font-size:0.85em;color:#666;display:block;margin-top:1em;}a.ask-tia-citation-link:hover{color:#11628d !important;background:#e9f6f5 !important;border-color:#11628d !important;text-decoration:none !important;}@media only screen and (min-width:768px){a.ask-tia-citation-link{font-size:11px !important;}}

🔗 Source: The Economic Times

🧠 Food for thought

1️⃣ Early venture investors capture exponentially higher returns through timing and risk-taking

Urban Company’s IPO showcases the significant difference in returns between early and late-stage venture investors.

Accel India, one of the earliest institutional backers, stands to gain a 29X multiple on its investment, while Elevation Capital will see 19X returns1.

In contrast, later entrants Tiger Global and Vy Capital will realize smaller multiples of 2X and 5X respectively, despite the company’s strong performance1.

This difference reflects the venture capital principle where early investors accept higher risk for potentially higher rewards, while later investors trade lower multiples for reduced risk as companies mature.

The contrast—from 29X for early investors to 2X for late ones—demonstrates how venture timing can influence whether an investment becomes a fund-returner or a solid performer.

2️⃣ Product diversification drives profitability in service marketplaces

Urban Company’s journey from marketplace losses to Rs 240 crore profit illustrates how service platforms achieve sustainability through product expansion.

The company’s Native product line, including smart water purifiers, contributed Rs 116 crore to total revenue of Rs 1,144 crore in FY25, representing over 10% of total revenue from this new vertical2.

This diversification helped the company achieve profitability after years of losses, turning around from a Rs 93 crore loss in FY24 to Rs 240 crore profit in FY251.

The transition from pure marketplace to a hybrid model combining services with physical products creates multiple revenue streams and higher margins, reducing dependence on commission-based marketplace economics.

This strategy allows Urban Company to capture value across the entire customer journey rather than just facilitating transactions between service providers and customers.

Recent Urban Company developments

……