Bengaluru-based instant househelp startup Snabbit reported revenue of Rs 12 crore in FY26, against a net loss of Rs 188 crore, while its total expenses during the year stood at Rs 195 crore, this also raises questions about the business model's sustainability.
Snabbit spent roughly Rs 16 for every Re 1 of operating revenue it generated. Company CEO Aayush Aggarwal has defended the report, noting that as the company scales, the unit economics will improve. However, not everyone is convinced with his answer.
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On Reddit, the headline has surprised many who follow the Indian startup space. Reacting to the report and Aggarwal's comments, a viral Reddit post questioned if this really “the future of startups?”
“Would you invest in a business where growth is explosive, but the cash burn is massive and revenue is still a fraction of expenses?” the post asked other users.
₹195 Cr burned. ₹12 Cr revenue. Is this really the future of startups?
by u/Ok_Force4354 in IndiaBusiness
Many have weighed on the business model, with mostly suggesting that such ventures are a “nightmare” for investors. “These startups are surviving on funding,” one user said, while another pointed out that quick commerce platform Zepto is also following a similar model.
Another user said: “These startups burn an insane amount of money early on.They are highly risky bets. Some will work, many will fail. This has been the past, and this will be the future of startups….”
Some critics also argued that when a company prioritises growth metrics over sustainable profitability, the IPO can become an exit strategy. Eventually, retail investors lose in such cases due to the “hype” around the IPO.
“He is raising Rs 2,500 crore already…. All is going to be dumped on retail. All sharks are waiting for the right time to enter the secondary market. The house help market is good but not at that revenue. Loss making in the long term because anyone can copy. It's just an app…,” one user said.
Some users also argued that successful companies like Zomato also began their journey similarly.
“It's the initial story of any famous unicorn today. Eg - Zomato…The point to note is how long they can keep up the burn to acquire new customers and when and how they flip it where they start charging more and become profitable….,” the user said.
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Snabbit's rivals Urban Company and Pronto, two other emerging players, have also posted significant losses while burning a lot of cash. Earlier, this year, Pronto even faced intense backlash after it was revealed that it was recording workers inside customers' homes for AI training. As customers raised concerns about privacy, Pronto later clarified that customers' were specifically asked for their consent for the activity.
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