Profit vs. Vision: The Kunal Shah Startup Debate and the Bigger Question for India’s Entrepreneurial Future

A LinkedIn post criticizing CRED and Freecharge founder Kunal Shah for sustained losses has reignited the debate on profitability vs. innovation in Indian startups. Read this 1500-word deep dive into the controversy, online reactions, and what it means for the future of entrepreneurship in India.

Introduction: When Success Isn’t Measured in Profits Alone

In the world of Indian startups, Kunal Shah is a name that resonates far beyond balance sheets. Known for founding Freecharge and CRED, Shah has carved out a unique space in India’s digital economy. But a recent LinkedIn post by Adarsh Samalopanan, a senior consultant at Deloitte, has brought his legacy into question—not for lack of vision or impact, but for a stark absence of profitability.

The post triggered a firestorm of debate, forcing both critics and supporters to confront a fundamental question: Should startup success be measured by profits, or is it about long-term value creation, innovation, and risk-taking?

Let’s break down what happened, examine both sides of the argument, and explore what this means for the future of Indian entrepreneurship.

The Controversial LinkedIn Post That Sparked the Debate

Adarsh Samalopanan’s post, while respectful in tone, didn’t pull any punches. He traced Kunal Shah’s 15-year journey in entrepreneurship, pointing out that despite two high-profile ventures, Shah has never posted a single year of profitability.

Here are some of the hard numbers Samalopanan presented:

Freecharge, launched in 2010, earned ₹35 crore in revenue by 2015 but had cashback-fuelled losses of ₹269 crore.
It was sold to Snapdeal for ₹2,800 crore in 2015 but later offloaded to Axis Bank for just ₹370 crore in 2017.
CRED, founded in 2018, has generated ₹4,493 crore in revenue but posted cumulative losses of ₹5,215 crore till now.

His concluding question was pointed:
“Fifteen years into entrepreneurship, he has yet to record a single profitable financial year, so remind me again why we celebrate him?”

Kunal Shah Responds: “You’re Right — But Let’s Talk About Risk”

To his credit, Shah responded directly and with humility.

“Absolutely correct. We should be celebrating thousands of entrepreneurs who have created very profitable companies without external capital,” Shah wrote.

However, he also offered a broader, future-facing perspective:

“We should celebrate everyone who is taking risk in life and being an entrepreneur because in the post-AI world, being a job seeker is going to be more risky. We need more job creators.”

This comment sparked a flurry of engagement on the post, leading to a deeper discussion around risk, innovation, and economic transformation.

The Startup Dilemma: Profitability vs. Long-Term Impact

The real issue here isn’t about Shah alone—it’s about how we evaluate startups in India. In the U.S., companies like Amazon were loss-making for years but disrupted entire industries. Tesla too, struggled for over a decade before seeing black ink.

Supporters of Shah argue that CRED changed how Indians think about credit card payments, credit scores, and financial responsibility. Similarly, Freecharge played a pioneering role in India’s digital wallet boom well before UPI took over.

One user on LinkedIn commented:

“Profitability matters—but in the startup world, it’s not the only thing. Freecharge and CRED changed how people think about payments, credit, and rewards.”

Another added:

“I don’t believe in equating loss to failure. Several businesses including Amazon were unprofitable for years but eventually delivered value.”

And yet, critics point out that sustained losses, especially when funded by venture capital, may create false valuations and crowd out smaller, bootstrapped businesses.

The Valuation Bubble? Or Building Digital Infrastructure?

The criticism isn’t just about losses—it’s about what those losses represent.

In Freecharge’s case, the platform was sold at a massive valuation to Snapdeal and then sold at a steep discount to Axis Bank. Was it overvalued?
In CRED’s case, its business model—offering rewards for credit card bill payments—has struggled to translate into revenue despite its popularity.

Skeptics argue that these are cases of VC-funded vanity, where companies are built to look good on paper but never aim for sustainability.

However, there’s another angle: CRED, Razorpay, Zerodha, and others have helped build a strong digital financial backbone for India. Even if profits are delayed, these companies help shift behaviors and create infrastructure that will outlast short-term P&L statements.

Who Should We Celebrate?

Samalopanan’s post posed a deeper philosophical question: Who deserves public celebration in the entrepreneurial world?

Should we:

Applaud profit-makers who quietly build successful, sustainable businesses, often outside the limelight?
Or should we also recognize visionaries who take huge risks to build platforms that shape industries—even if they bleed money for years?

Both groups are essential. But the debate highlights the danger of media-driven glorification of startup founders, where hype may overshadow results.

Kunal Shah himself acknowledged this by saying:

“We should be celebrating the many profitable companies built without venture capital.”

It’s a moment of rare self-awareness in India’s otherwise glamorized startup ecosystem.

The Role of the Indian Ecosystem

The Indian startup scene is still young and evolving. Losses are not inherently bad—they’re often the cost of experimentation and market-making. However, there needs to be transparency, accountability, and a path to eventual profitability.

Investors, regulators, and the public must learn to ask better questions:

What is the company’s real value to the ecosystem?
Is there a business model or just a buzzword?
Are valuations being pumped artificially?

What’s Next for Kunal Shah and CRED?

Despite the criticism, CRED is still standing, attracting funding rounds, acquiring fintech startups, and expanding services like rent payments, lending, and more.

If CRED can pivot to sustainable revenue generation through lending, subscriptions, or financial services, it could still become a massive success story.

Kunal Shah, meanwhile, seems unfazed. He’s still one of India’s most followed entrepreneurs on social media, known for sharing sharp takes on society, finance, and human behavior.

Whether you admire him or criticize him, one thing’s for sure—he has kept the conversation around startups alive and intellectually stimulating.

Conclusion: Beyond Black and Red Ink

The debate sparked by Adarsh Samalopanan’s post is healthy—and overdue. India’s startup scene must learn to distinguish between narrative and numbers, vision and viability, style and substance.

Kunal Shah’s journey may not fit the traditional mold of success, but it represents the evolution of India’s risk appetite. And that, too, is worth recognizing.

Instead of asking “Why do we celebrate him?”, maybe the better question is:
“What do we really value in our entrepreneurs—and why?”

Author’s Note:

As someone observing India’s tech ecosystem closely, I believe both profitability and innovation must coexist. Risk-takers like Kunal Shah are essential, but so are unsung heroes building quietly profitable ventures in Tier-2 cities.

Let’s not reduce the conversation to binary outcomes. Let’s push for transparency, accountability, and long-term value. After all, the future of India’s economy will be shaped not just by balance sheets—but by boldness, ethics, and empathy.

The Financial And Tech Literacy