Chasing scale: What IPOs demand from India’s influencer marketing sector

In September, Chatterbox Technologies, the digital and influencer marketing agency providing digital and influencer marketing services through the segments Chtrbox (influencer‑marketing platform and agency) and Chtrsocial (social‑media management and brand‑design arm), launched its IPO (Initial Public Offering) and got listed on the stock exchanges on October 3.

The shares, with a face value of Rs 10 each, were priced in the range of Rs 110 - Rs 115. Following the issue, it was reported that QYOU Media and Raj Mishra (Managing Director and CEO of Chatterbox Technologies), as promoters, would together retain approximately 60 percent of the company’s shareholding.

With Chtrbox going public, the key question emerging in India’s evolving influencer marketing landscape is this: What challenges do influencer marketing agencies face after going public?

Kalyan Kumar, co-founder and chief executive officer of Klug Klug, outlines the foundational issue. “Influencer marketing agencies in India have historically been service-heavy and margin-light. Most operate on wafer-thin profitability in a commoditised ecosystem where cost efficiency — not differentiation — wins pitches,” he says. “That’s why very few have been IPO-ready until now.”

The IPO filing of Chatterbox Technologies (Chtrbox) marks a cautious but important milestone — a sign that the sector is maturing and attempting to institutionalise itself.

Rohit Raj, co-founder of Done Deal (data driven tech platform) and former strategic partner at Chtrbox, views the timing as significant. “It indicates the industry’s shift towards formalisation,” he says. Raj adds that capital itself acts as a moat in this business.

He says, “The influencer space is working-capital-heavy — brands pay later, but influencers must be paid upfront. IPO capital smooths these cycles, increases trust among creators, and drives more sign-ups.”

Aman Narula, chief operating officer at Mad Influence, agrees. “Going public offers several advantages,” he says. “It raises funds for expansion — whether in studios, workforce, or geographic reach — enhances credibility with both brands and influencers, improves governance, and may result in better valuations,” he states.

Chtrbox, for instance, plans to use its IPO proceeds to build a new studio, expand offices, invest in brand building, and meet working capital needs. The fact that its IPO drew a strong 52x subscription indicates significant investor confidence — a signal that can strengthen client negotiations, Narula adds.

Read More: Creator economy in India hits Rs 3,500 crore, fueled by ecomm, FMCG sectors: Kofluence

The post-IPO reality check

However, listing on the public markets comes with intensified scrutiny — and new challenges.

Narula points to key hurdles. He says, “Rapid platform changes (algorithms and policies), rising competition, influencer saturation, client ROI expectations, legal and regulatory uncertainty, and high dependency on a few big clients — all become magnified post-IPO.”

Agencies, he says, must stay agile to platform shifts, invest in R&D and analytics, diversify their client bases, consider strategic partnerships or mergers, and implement stronger risk management and compliance frameworks.

Raj reflects on how much the landscape has changed. “Five years ago, when Chtrbox was speaking to VCs, there was skepticism about TAM (Total Addressable Market). Today, it’s a proven Rs 3,000+ crore market — tech has brought transparency and structure to what was once an unorganised space.”

But according to Klug Klug’s Kumar, while an IPO can improve financial discipline and payment hygiene, it doesn’t resolve the underlying power imbalance where brands dominate. “Public markets enforce accountability — but structurally, brands still hold most of the power,” he says.

Client concentration & cash flow stress

One of the most significant risks is client concentration. Narula explains, “A single big client often contributes a major share of revenue. If that client delays payments or exits, it can hit cash flows, morale, and valuations hard.”

To mitigate this, agencies must diversify across client types, sectors, and campaign durations. “Agencies should also cap exposure per client, negotiate long-term contracts, and maintain cash reserves,” he advises.

The agencies that are currently profitable, Kumar notes, are those that go beyond campaign execution. “The real value lies in layers like proprietary data, influencer intelligence, or content-to-commerce models — not just running campaigns. These are the models investors will favour long term.”

Read More: Influencer marketing booms, but brands still flying blind

Moving towards predictable revenue

Raj challenges the perception that influencer marketing is seasonal. “It’s actually an always-on business. Larger players are already adopting subscription models and long-term influencer partnerships, generating recurring revenue.”

Deepshikha Bhardwaj, national lead – media strategy at Schbang, agrees. She says, “Agencies must diversify income beyond one-off campaigns — through retainer models, tech products, and analytics offerings. Building recurring revenue helps cushion seasonal dips.”

Aditya Gurwara, co-founder of Qoruz, adds that the category has matured significantly. “Influencer marketing has moved from being tactical to a strategic brand channel. Budgets are bigger, measurement is sharper, and brands are now thinking long-term.”

Going public, he says, forces agencies to maintain cleaner books, consistent delivery, and governance — all of which benefit the ecosystem. “Transparency builds trust across creators, brands, and investors,” he adds.

Post-IPO: Investor scrutiny & operational discipline

But the real challenge post-IPO, according to Kumar, is sustainability. “Can these agencies demonstrate predictable revenue, healthy margins, and real measurement in a volatile, seasonal, and at times inflated business?”

Investor expectations will demand more diversified revenue, tighter cost control, and transparency in performance reporting.

Narula advises that agencies diversify geographically, across campaign types (retainer vs project), and influencer tiers (nano to macro). “Chtrbox, for example, is likely to use some IPO capital to streamline its payment cycles and improve cash-flow efficiency,” he says.

He also recommends a lean operational model. He says, “Avoid overhiring, use scalable infrastructure, and maintain flexible teams. Strong forecasting and reserve management are key.”

Reputational risk & compliance pressure

As publicly listed entities, agencies must now double down on due diligence. Mad Influence’s Narula says this includes verifying influencer authenticity, enforcing disclosures, measuring engagement quality, and setting clear KPIs.

“With financial audits and investor scrutiny, delays in payments or performance gaps now carry reputational and financial risks,” he explains. Contracts may evolve to include late-payment penalties, escrow models, and stricter legal terms.

“Regulatory scrutiny might force brand-side accountability, but only agencies with scale and leverage can demand that,” Narula adds.

Raj agrees that IPO status may open doors to bigger brands, but the fundamental client-agency dynamic won’t change overnight. “You may look more credible post-IPO, but working relationships still hinge on delivery, trust, and results,” he says.

The road ahead: Smarter curation, stronger foundations

Seasonality remains a reality, Qoruz’s Gurwara notes. He states, “Festive periods and cultural spikes dominate campaign calendars. But smart agencies are now offering year-round retainers and building tech-led solutions — IPOs will only accelerate this.”

With capital infusion, agencies are likely to invest in better influencer vetting systems, AI-driven authenticity tools, and content quality scoring mechanisms. “Curation will replace mass inclusion,” Bhardwaj says.

She also notes that regulatory oversight (e.g., SEBI) will push agencies to standardise influencer contracts, payment policies, and data use.

“Post-IPO, expectations go beyond campaign creativity. Agencies must deliver governance, sustainable margins, and investor-grade disclosures,” Bhardwaj concludes.

Read More: Chatterbox Technologies IPO: Influencer marketing agency spends Rs 12.28 lakh on ads, clocks Rs 24.2 lakh revenue in FY24