The funding winter for the startup ecosystem might proceed for one more 12 to 18 months and the trade may need to grapple with a “lot of turmoil and volatility,” e-commerce big Flipkart chief govt Kalyan Krishnamurthy has warned executives.

“That is going to be powerful subsequent yr. My estimate is that a whole lot of startup founders will hit the market between April to June subsequent yr, and that’s the second of reality for the ecosystem,” he stated at a gathering over the weekend organized by Indian newspaper Financial Instances.

Usually a reserved and soft-spoken govt, Krishnamurthy advised lots of of attendees that startup founders ought to embrace a down-round and restructure their corporations. Many startup founders usually are not wiling to take a haircut on their earlier valuations in new funding deliberations, traders say.

Some startup founders consider that they will be unable to draw and retain the expertise if a funding occasion out of the blue makes the staff’ present shares much less useful.

“In 2001, corporations noticed a 2x to 6x spike in valuation with some underlying development and profitability assumptions for the subsequent two to 3 years. I feel it shortly grew to become clear that these assumptions usually are not going to play out,” stated Krishnamurthy, describing the increase to startup funding in India final yr.

Indian startups raised a file $39 billion in 2021 as traders aggressively regarded to double down in rising markets. In distinction, because the market reserved its place earlier this yr, funding within the quarter that led to September slid under $3 billion.

And which means an introspection on what must be performed to outlive, he stated.

Krishnamurthy, who beforehand labored on the funding store Tiger World, famously helped architect Flipkart reduce its workforce by 30% 5 years in the past to assist the agency develop into extra environment friendly. “We grew from there, so it’s not an issue,” he stated.

Walmart-owned Flipkart, final valued at $37.6 billion, put a hiring freeze earlier this yr and halted its acquisition spree, which earlier noticed it spend about half a billion {dollars} to increase into on-line healthcare and journey classes. The agency — which counts SoftBank, Tiger World, GIC, Canada Pension Plan Funding Board, Qatar Funding Authority, Tencent and Franklin Templeton amongst its backers — doesn’t plan to go public for at the very least a yr.