India, the third-largest startup ecosystem in the world, is home to nearly 60,000 startups and 91 unicorns . According to data from YS, last year alone, startups raised in excess of $32 billion across more than 1,400 deals. Furthermore, 41 unicorns emerged in India in 2021, and there are 70 soonicorns (startups with more than $100 million in funding), indicating a thriving startup ecosystem.
As startups approach the hyper-growth stage, the ability to adapt and scale rapidly while remaining operationally efficient is essential to success – regardless of the sector in which they operate.
Given the competitive dynamics, preparation and planning becomes key to attracting the underwriters and investors needed to make an IPO soar or reach the coveted unicorn status. This means paying greater attention to business processes and ensuring the company is ready to scale.
This is why so many fast-growing companies choose to deploy an effective ERP system. It acts as a single source of truth, unifying all critical business functions, producing real-time reports, and means business performance data is accessible 24/7 in the cloud.
A solution for every round of funding
Whether you are a pre-seed startup or scaling towards IPO, your business is all about consistency. NetSuite, a leading cloud ERP, helps maintain business continuity so you can drive toward your ultimate growth strategy. Recognising that companies at every stage of the investment cycle must be bold and move fast to remain competitive, NetSuite offers a system that can be deployed quickly and deliver value immediately. It gives venture capital-backed companies the software platform necessary to optimise performance and progress rapidly.
In India, Farmpal, an angel-invested agritech startup that empowers farmers by connecting them to buyers directly with an end-to-end supply chain, uses NetSuite ERP to integrate financial and inventory data. With real-time data access, it’s accelerated payment cycles for farmers from one week to three days.
“NetSuite’s SuiteSuccess is our secret tool for engineering the success of Indian farmers with visibility into inventory and financials to help them sell better. Investors liked our use of technology, data and insights, because it gave them a clear idea of exactly how we’re going to achieve our vision.” says Karan Hon, Co-founder, Farmpal Techlogi.
5 ways an ERP system supports aspiring unicorns
1. Getting financials in order
Having a strong and comprehensive financial foundation is essential for startups looking at scaling-up rapidly. Without a system in place that gives key stakeholders appropriate and real-time access to critical business data, the journey gets a lot tougher.
Investors and underwriters want to see solid debt-to-equity ratios, sufficient market capitalisation, and predictable revenue and earnings streams. NetSuite helps scale-ups on all of these fronts, providing the financial data and insights to demonstrate a company’s standing and potential for growth.
IPO candidates must be capable of dealing with modern accounting challenges, such as asset valuation impairment, consolidated subsidiary financial statements issues, and revenue recognition. NetSuite’s dashboard and built-in reporting capabilities makes it easy to comply with these otherwise complex requirements.
Finally, businesses must establish processes for key areas that touch revenue, headcount and all other major expenditures. The infrastructure must have the necessary controls in place to manage these processes, as well as the flexibility to accommodate changes down the road, which NetSuite supports.
2) Developing rigorous financial reporting
The process of securing investment is aided by clean and efficient production of financial statements, so there’s significant value in choosing systems and automation tools that support global consolidation and financial reporting. By eliminating manual reconciliations and data entry, a company can scale more effectively as the business grows in volume or complexity.
Moreover, the ability to analyse past performance and forecast future performance requires business intelligence tools and analytics. NetSuite does all of this seamless, providing robust reporting and analytics organisations need to establish these, including:
- Practices with automated reports around key performance indicators (KPIs).
- Role-based dashboards, and the ability to drill down by department, subsidiary or location.
- An intuitive interface that allows even all users to perform complex analytics.
3. Establishing good corporate governance
Many private companies don’t take into account the importance of governance in long-term success, and those that do make governance a priority often underestimate the time and effort required to establish effective corporate governance.
When a company goes public, regulators and investors alike demand that it be coordinated, transparent and consistent, unlike the loose policies and casual atmosphere that prevails in many private companies. Good corporate governance, therefore, is not optional.
NetSuite has extensive Governance, Risk and Compliance (GRC) capabilities, giving startups confidence in their reporting and auditing from day one right the way through to IPO. Furthermore, automated controls and role-based access can embed a measure of security within the financial system as well.
4. Telling your company’s story
Regardless of whether it’s impressing your customer or investor, telling your story well is a critical component of a startup’s success. Effectively articulating everything from product roadmap to brand identity and growth objectives keeps the stakeholders informed and confident that the company is on the right path.
In other words, it’s not enough to have a good story; it’s critical that the leadership team can both tell it and back it up with data. That means having an investor relations (IR) and communications team that’s as adept at proactively conveying the brand as it is at responding quickly to news, both good and bad.
A strong IR team, backed by metrics that provide a clear picture of the business, needs an infrastructure that can report on those metrics. By providing quick access to financial metrics and reports, NetSuite can provide the capabilities companies need to build an IR organisation that’s informed, incisive, and prepared to face public-market scrutiny.
5. Developing risk management capabilities
Going public is a process that introduces significant risk to a company, forcing it to become more accountable to a wider range of investors and regulators should it begin to perform poorly. Being able to see potential problems before they emerge can mean the difference between long-term success and bankruptcy.
Apart from ensuring that legal counsel has a strong voice, and that a policy protecting the company against the acts of directors and officers is in place, a public company also needs to be able to respond when an audit committee or the board of directors asks about management expenses, approving major costs, cash access or forecasting.
NetSuite provides access to real-time KPIs and automated rule-based alerts needed to identify risks before they become real-life problems. This helps protect against uneducated decision-making by leadership, and helps preserve your system’s integrity.
Leading the tech IPO market
Adaptability and optimal operational efficiency are more important than ever before for scale-ups, so it’s easy to see why NetSuite leads the way in the tech IPO market. Its built-in flexibility and ease, commerce-ready ERP, and native business intelligence tools empower businesses with the necessary visibility and control to make the right decisions, right now.
Did you know that 63 percent of tech IPOs have been NetSuite customers since 2011? You could be next.
What 29,000+ high growth companies have in common
As the world’s leading cloud ERP, NetSuite offers startups one unified business management suite, encompassing ERP, financials, CRM and e-commerce for more than 29,000 customers across the world. NetSuite’s solutions help startups go live 60 percent faster, get 18 percent lesser implementation costs with 90 percent implementations being immediately referenceable.
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