Bollywood’s Entrepreneurial Leap, Investments In Startups And The Pitfalls Of Wealth Infusion And Creation In The Startup Ecosystem

The growing influence of Bollywood divas extends beyond the silver screen, as they actively participate in the startups ecosystem. Alongside their successful acting careers, actors like Alia Bhatt, Deepika Padukone, Katrina Kaif, Aishwarya Rai Bachchan, Kirti Sanon, Varun Dhawan, Sonu Sood and many many more have embraced entrepreneurship and recognized the value of intelligent investments.

Deepika Padukone, for instance, invested in the FMCG health food brand Epigamia and Delhi-based electric mobility startup Blu Smart, the education platform FrontRow (backed by Deepika Padukone and Raftaar and now ceased business operations), not to speak about her own venture 82 E (Skincare line).

According to her, she seeks out companies and brands that break the clutter and contribute to the country’s development as well as substantial wealth for herself.

Thus, these Bollywood actors apparently are not only bringing their star power but also their financial acumen to the table.

The trend continues with Alia Bhatt, who invested an undisclosed amount in Nykaa, an omnichannel lifestyle retailer. This move followed Katrina Kaif’s investment in the same firm. Kaif’s investment came about a year after she launched her beauty brand, Kay Beauty, in partnership with Nykaa.
Besides, Aishwarya Rai Bachchan and Priyanka Chopra-Jonas have also made strategic investments in startups, such as an environmental intelligence startup and an alternative college education startup, respectively.

The Budding Bollywood Entrepreneurs

Experts view this shift towards startup investments as a prudent move by actors, considering the uncertainty that comes with a film career. Investing (wisely) allows them to build a financial cushion for themselves, especially during periods of career instability. Prahlad Kakkar, an advertising expert, emphasizes the importance of making smart investments with the guidance of financial advisors to secure their financial future.

The Pitfalls of Wealthy Actors’ Investments in Startups

While the involvement of wealthy actors in the startup ecosystem may bring attention and capital to emerging businesses, there are potential downsides to consider.
The investments of actors with substantial (unaccounted?) wealth can have negative implications for startups seeking genuine investors and sustainable growth.
Hence, could there be a darker side to actors’ investing in startups?

The Question Of Transparency
One of the primary concerns surrounding actors’ investments in startups is the lack of transparency regarding the source of their funds. Some actors may accumulate significant wealth through undisclosed means, raising questions about the legality and legitimacy of their investments.

This ambiguity can damage the principles of fairness and equal opportunity that the startup ecosystem must strive to uphold; recently, questions have emerged in terms of compliance issues within the Indian startup ecosystem, for example – Byju’s

Overpowering The Startup Itself
Actors with abundant, unaccounted wealth often wield significant influence and bargaining power when it comes to investment deals. Their fame and financial resources can significantly overshadow the actual potential of a startup, leading to an imbalanced power dynamic.

This can result in unfair negotiations, where the startup may be forced to compromise on its vision, equity distribution, or long-term sustainability to accommodate the demands of the actor-investor.

Commitment
Startups, especially those in early stages, rely heavily on genuine investors who bring capital and the much-needed expertise, guidance and a long-term commitment to the startup’s growth.

However, when actors with vast amounts of money invest in startups primarily for publicity or personal gain, the startups may suffer from a lack of genuine support, thus hindering the startups’ ability to access the resources and mentorship necessary for their sustainable development.

Concentration Of Wealth
The influx of money from actors into startups can create an unhealthy environment of competition and favouritism within the startup ecosystem. Smaller investors, who may genuinely believe in the potential of a startup and have limited financial means, find themselves at a disadvantage.

Their contributions, which may be vital for a startup’s growth, can be overshadowed by actors’ massive investments and celebrity endorsements. Thus, it can discourage smaller investors from participating in the ecosystem, leading to a concentration of power and wealth in the hands of a few influential individuals.

Here are some Bollywood actors who have invested in Indian startups –

Sonu Sood– Sonu Sood co-founded an AI-based social media app called Explurger, which creates automatic travelogues using AI.

He also founded a job search platform for migrant workers named Pravasi Rojgar and invested in rural fintech startup Spice Money via his company Sood Informatics LLP. He endorsed the business as its brand ambassador and joined the board as a non-executive member.

Kriti Sanon– Bollywood actress Kriti Sanon started her entrepreneurial journey by launching her fitness startup, The Tribe. Sanon, Anushka Nandani, Karan Sawhney and Robin Behl cofounded the website and app-based startup.

Varun Dhawan – Actor cum investor Varun Dhawan added a new startup to his portfolio by investing in cloud kitchen aggregator Curefoods. As a part of the deal, Dhawan inked a long-term association with dark kitchen aggregator, thereby becoming the brand ambassador of EatFit.
Earlier, he also made an undisclosed investment in the D2C brand Fast&Up which manufactures nutraceuticals and immunity-boosting supplements.

Rakul Preet Singh – Bollywood actress Rakul Preet Singh made her first investment in D2C health and nutrition startup Wellbeing Nutrition. As part of the deal, Singh also became the brand ambassador for the startup.
The startup also partnered with Disney to launch its children-focused organic vitamins, probiotics and omega supplements.

Gaurav Kapur– Gaurav Kapur invested in the D2C brand Flatheads, which manufactures sneakers. He is also associated with sports-centric online media startup Oaktree and has investments in other startups like Jade Forest and Chtrbox.

Sara Ali Khan –  invested in the casual wear and pop-culture D2C startup called The Souled Store. She also became an equity partner in the startup.

Samantha Prabhu – invested in Hyderabad-based SustainKart, an e-commerce marketplace for sustainable products.

Rana Daggubati – startup Ikonz raised seed funding from Village Global and Woodstock. He also launched Socialswag with Akshay Kumar, which raised funding from IMEF and Unicorn India Ventures.

Athiya Shetty – Athiya Shetty invested in Delhi NCR-based social commerce startup Stage3 and joined the company as its creative director.

Suniel Shetty – Suniel Shetty invested in fitness startup Aquatein and became its brand ambassador. He also joined the NFT marketplace Colexion as an investor and advisor.

Pankaj Tripathi – has shown his faith in Indian startups by making an undisclosed investment in the agritech startup Krishi Network.

Anushka Sharma – Over the years, Anushka Sharma has backed some homegrown startups and also founded her D2C fashion line Nush. In February 2022, she and her husband, Virat Kohli, invested undisclosed in plant-based meat startup Blue Tribe.

Earlier in 2020, Anushka Sharma and her husband infused $340K in fintech unicorn Digit Insurance’s funding round. Digit Insurance raised nearly $84 Mn in the then-funding round.

Tiger Shroff – In January 2022, he made an undisclosed amount in the English learning startup for 3-12 year-olds Freadom’s funding round.

Earlier in 2016, Tiger Shroff launched his clothing line Prowl which sells clothes on its website and online marketplace Amazon.

Deepika Padukone – has several feathers on her hat. After gaining success in media and entertainment, she founded her fashion line called All About You in 2015.

Her family office participated in the $7.1 Mn Pre-Series B funding round of Women’s wellness D2C brand Nua in June 2021. Padukone is also set to work closely with the brand to ideate and create new solutions

Its next investment was in the $3.2 Mn seed funding round of the learning and community platform FrontRow in August 2021 (which is now shut down).

In September 2021, KA Enterprises, the investment arm of Padukone’s family office, invested an undisclosed amount in Mumbai-based cleantech startup Atomberg Technologies’ Series B funding round. The home appliance startup manufactures energy-efficient, remote and voice-controlled fans and fan accessories.
She has also started her own skin line 82 E.

Aishwarya Rai Bachchan – The former pageant winner and Bollywood actress Aishwarya Rai Bachchan has made a few bets on Indian startups. She invested INR 5 Cr in nutrition-based healthcare startup Possible; as part of a larger funding round where the startup raised INR 15 Cr ($2 Mn).
In 2019, she invested in environment intelligence startup Ambee.

Farhan and Zoya Akhtar– made an undisclosed investment in EV manufacturer Ola Electric.

Alia Bhatt – In 2021, she started her investments with StyleCraker and listed startup Nykaa.
Following this, she also launched her own startup called Ed-a-Mamma, which is a kidswear fashion brand that offers clothes for children between the ages of two and fourteen. The brand sells its products through its own website and platforms, Amazon and Flipkart.

In 2021, she invested in D2C wellness startup Phool. Co.

Malaika Arora – In 2021, she launched Malaika Arora Ventures to invest in lifestyle, health, fashion and wellness brands.
The fund made its first investment in D2C ayurvedic nutrition brand Kapiva; she also joined the startup as a brand ambassador.

Shraddha Kapoor – invested an undisclosed amount in personal care company MyGlamm, where she also joined as a brand ambassador in 2021.

Akshay Kumar – invested an undisclosed amount in Mumbai-based wearable tech startup GOQii, in 2019 and also joined the startup’s board as an investor and strategic advisor.

In 2021, Kumar and Rana Daggubati together launched the fan engagement startup Socialswag.

Priyanka Chopra – created quite a buzz with her investments in alternative college education startup Holberton School and dating app Bumble in 2021; after her investment, Bumble launched its operations in India.

Ayushmann Khurrana – in 2019 invested an undisclosed amount in Gurugram-based male grooming startup The Man Company (TMC). The actor also became the brand ambassador for TMC as well.

The above are just a few examples of Bollywood actors who have shown interest in the Indian startup ecosystem and have gone on to make substantial investments in diverse sectors such as technology, fitness, nutrition, fashion, and more.

The Last Bit, The mix of Bollywood and the startup world, reflects a shared goal – with their star power and financial resources, Bollywood divas are actively participating in the Indian startup ecosystem, becoming angel investors, and even moving ahead to launching their own ventures.
While it is true that actors’ investments in startups can bring initial publicity and capital, the wealth they inject into the ecosystem can also have negative repercussions – lack of transparency, potential influence, and adverse effects on smaller investors – thus the need for a more equitable and regulated investment environment is essential.
Thus, to facilitate a sustainable startup ecosystem, it becomes crucial to encourage genuine investors who contribute not only financial resources but also expertise, guidance, and long-term commitment to the growth and success of startups in India.