Ribbit Capital Trims Groww, Lightspeed Exits PhysicsWallah as Early Backers Cash Out ₹2,770 Crore

Two of the most prominent early backers of India's newly listed startups headed for the exit on the same day. On Wednesday, August 26, Silicon Valley fintech investor Ribbit Capital sold Groww shares worth around ₹2,217 crore in block deals, while Lightspeed Venture Partners disposed of its entire remaining stake in edtech firm PhysicsWallah for roughly ₹550 crore, according to reports in Inc42, Business Standard and Business Today. Taken together, nearly ₹2,770 crore of stock in two of the most closely watched companies from India's 2025 IPO class changed hands in a single session — and the two stocks reacted in strikingly different ways.

Ribbit takes another ₹2,217 crore off the table at Groww

According to Inc42, Ribbit Capital V sold 6.3 crore shares of Groww at ₹196 apiece, while a second entity, Ribbit Cayman GW Holdings V, sold nearly 5 crore shares at ₹196.06 apiece. The combined transaction was worth about ₹2,217.3 crore and amounted to roughly 2% of the company's equity, executed at a discount of less than 0.1% to the previous close.

Business Standard reported that around 12.75 crore shares of Billionbrains Garage Ventures — Groww's listed parent — or about 2.1% of its equity, changed hands in block deals worth roughly ₹2,500 crore in total, with a floor price of ₹195 per share. The stock fell 3.19% to ₹196.54 on the news, with volumes on the NSE surging to 15.56 crore shares against a two-week average of 3.25 crore. The newspaper added that the seller is subject to a 30-day lock-in following the sale, meaning Ribbit cannot offload further shares immediately.

Ribbit Capital is one of Groww's oldest institutional investors, having led its $21.3 million Series B round back in 2019, according to Inc42. As of June 30, 2026, the two Ribbit entities together held 63.35 crore shares, or about 10.1% of the company. This week's sale is not Ribbit's first trim: Inc42 reported that the firm sold shares worth ₹2,567.1 crore in bulk deals in May 2026 and took home ₹854.7 crore from the offer-for-sale portion of Groww's IPO.

Nor is Ribbit alone. Inc42 noted that Y Combinator recently sold 7.47 crore Groww shares for ₹1,435.2 crore — crystallising what the publication calculated as a 55.7x return on its early bet — while investment firm Friale sold 1.13 crore shares to Goldman Sachs for ₹210.4 crore in June.

Notably, the sellers are exiting into strength rather than weakness. Groww reported a consolidated net profit of ₹735 crore for the first quarter of FY27, up 94.3% year-on-year, on operating revenue of ₹1,501.4 crore, a 66% jump, according to figures cited by both Inc42 and Business Standard. The stock, which listed on November 12, 2025 at ₹114 — a 14% premium to its issue price — still trades about 96% above that issue price even after Wednesday's drop, per Business Standard.

Lightspeed makes a quick, complete exit from PhysicsWallah

The PhysicsWallah transaction was smaller but more decisive. Inc42 reported that Lightspeed Opportunity Fund II sold 4.67 crore shares — its entire remaining 1.61% stake — at an average price of ₹117.72 per share, generating ₹549.7 crore and ending its association with the Noida-based edtech company. Business Today confirmed that 4,66,98,120 shares worth ₹549.73 crore changed hands on the exchanges on Wednesday.

The buyers' list reads like a roll call of large institutions. ICICI Prudential Mutual Fund picked up around 2.2 crore shares worth about ₹259 crore, Inc42 reported, while Goldman Sachs bought roughly 89 lakh shares across five entities. Ghisallo Master Fund, Societe Generale and Morgan Stanley Asia were among the other buyers.

Unlike Groww, PhysicsWallah's stock absorbed the supply and then some: Business Today reported the shares climbed 3.86% to ₹126.03 on the day of the deal, even though Inc42 said the block was priced at a 6.7% discount to the previous close.

Lightspeed's exit stands out for its speed. The firm first invested in PhysicsWallah only in September 2024, as part of the company's $210 million Series B round, per Inc42, and held a 1.79% stake at the time of the November 2025 IPO. Its complete departure comes less than two years after it first wrote a cheque — and less than a year after listing.

Founded in 2016 by educator Alakh Pandey, PhysicsWallah raised ₹3,480 crore in its IPO, which Business Standard reported opened on November 11, 2025. The stock has had a bumpier ride than Groww: it still trades below its listing-day opening price of ₹143.10 and touched a 52-week low of ₹77.75, according to Inc42. Operationally, though, the picture is improving — Business Today reported that the company's consolidated net loss for the June quarter narrowed to ₹77.6 crore from ₹120.5 crore a year earlier, on revenue that rose to ₹1,054 crore from ₹847.1 crore. Promoter entities still control 71% of the company, and the board recently approved acquiring an additional 11% of exam-prep firm Sarrthi IAS for ₹71.81 crore, part of a plan to take its holding up to 85% between 2026 and 2031.

The great unwind of the 2025 IPO class

Wednesday's twin deals fit a pattern that has been building all year. The venture funds that financed India's startup boom of the late 2010s are steadily converting paper gains into cash as post-IPO lock-ins expire, and the sales at Groww — where Y Combinator, Friale and Ribbit have all sold in the space of a few months — show how quickly a cap table can turn over once a company is public.

The other side of the trade is just as telling. Domestic mutual funds such as ICICI Prudential and global institutions including Goldman Sachs and Morgan Stanley are stepping in to buy what the venture firms are selling, shifting these companies from venture-backed startups to institutionally owned listed businesses. The divergent market reactions — Groww down about 3%, PhysicsWallah up nearly 4% — suggest investors are now judging each name on its own fundamentals rather than treating new-age stocks as a single trade.

Sources: Inc42 — Ribbit Capital Sells Groww Shares Worth ₹2,217 Cr; Inc42 — Lightspeed Exits PhysicsWallah Post ₹550 Cr Stake Sale; Business Standard — Groww drops after large block deal; Business Today — PhysicsWallah block deal: Equity worth Rs 550 crore changes hands.