I don't think Indian e-commerce companies have an evolved business model.

This quote by Rakesh Jhunjhunwala, one of India’s most prominent investors and stock market strategists, reflects his critical view of the early state of Indian e-commerce. When he says, “I don’t think Indian e-commerce companies have an evolved business model,” Jhunjhunwala is expressing skepticism about the sustainability, profitability, and strategic clarity of many online businesses operating in India at the time. His comment highlights concerns over companies focusing more on growth and valuation than on creating a solid, long-term economic structure.

Jhunjhunwala was known for his candid opinions and deep understanding of fundamentals in business and investing. His criticism likely stemmed from observing e-commerce firms that were burning cash to acquire users through heavy discounting and marketing spends, without clear paths to profitability. Many of these companies were prioritizing customer acquisition and market share over financial discipline, which, in his view, did not constitute a mature business model.

The quote reflects a broader concern that was prevalent in the Indian startup ecosystem during the 2010s and early 2020s, where many unicorns were valued highly despite lacking consistent revenue streams or sustainable unit economics. Jhunjhunwala's warning served as a call for e-commerce firms to focus on value creation, operational efficiency, and self-sufficiency, rather than depending solely on investor funding and aggressive growth tactics.

Ultimately, this quote reinforces Jhunjhunwala’s belief in business fundamentals. For him, a truly evolved business model must deliver long-term profitability, demonstrate scalability, and create real value for customers and shareholders alike. His perspective encourages entrepreneurs and investors to look beyond hype and evaluate companies on the strength of their core economics and strategic vision.