The Damani Family Office Invests in Startups Focused on Serving 'Bharat'
Anirudh Damani of Artha India Ventures is scouting for startups that are serving customers in smaller cities
Anirudh Damani, director of the Damani family office Artha India Ventures, comes from a family of investors. "My father became a stockbroker in early 1980s even before I was born. My earliest childhood memories consist of family gathering and parties where conversations revolved only around investing in stocks and bonds. It was inevitable that I will become an investor," he says.
Set up in 2015, Artha India Ventures has made 67 start-up investments in India and abroad. The family office's portfolio consists of star investments such as Purplle, BabyChakra, Oyo Rooms, Coutloot, Fynd, Lightyear and Supr Daily, among others.
Betting Big on the "Bharat' Theme
On being asked which company has given maximum profit till now, Damani makes it clear that he assesses the success of his investment on the basis of the value a company creates for its customers. "For me, any investment is truly satisfactory when that company has impacted millions of lives across the globe. On that parameter, BabyChakra, a one-stop parenting platform and Santa Monica-based fintech startup Tala have been the best investments so far."
Damani wants to invest in consumption themes serving smaller cities. "I'm bullish on start-ups focused on serving "Bharat' that exists beyond the metro cities. This especially includes B2B companies catering to the MSME sector," he adds.
To extend the scope of his investing, Damani has started Artha Venture Fund, co-sponsored by the family office. The fund has made six investments so far with average ticket size of INR 1-3 crore.
Though sector agnostic, most of Artha India Ventures and Artha Venture Fund investments have been in fintech, consumer goods and services, travel and hospitality, and B2B with a portfolio size of about INR 150 crore.
What Entrepreneurs Can Expect
Damani's mission as an investor is to create and showcase the Indian model of entrepreneurship across the globe. His mission statement has been honed from his own experience of starting up. "After I returned to India to start my own business, the several roadblocks made me realize how difficult it is to start a business in our country. With this realization, I started looking for early-stage companies to make angel investments and help them scale their businesses," he recalls. "I offer my expertise in sales, marketing, business development, recruiting, leadership development, and my family network in India and the US to founders of the start-ups I invest in."
For this reason, Damani has a simple investment strategy: "I invest early and in businesses that I understand so that I can help them in ways other than just monetary support. I pick start-ups that have a passionate founding team willing to solve a real problem."
Damani believes that no business can continue to scale in the same model that it started with and therefore, entrepreneurs should build a company with a clear aim of selling it at the right time and for the right value.
"When an entrepreneur starts a business with the intent that someone else will have to manage it in the future, they will create a company that can operate without their involvement. Getting their business to that state is the ultimate goal for an investor," he says. But he does not have a fixed exit time frame for his investments as he holds them on the basis of how a business performs.
On Hits and Misses
Oyo Rooms is the stellar exit on Damani's list of investments, which has fetched him a staggering 150 times returns. Apart from Oyo, he has many other early entry investments that have yielded him significant returns. "First positions in OYO, Tala, Purplle, SuprDaily, Coutloot, Exotel, and Beardo have given back handsome returns on the money as well as the time I've invested," he says.
Along the way he has also missed some opportunities. "I regret not investing in BharatPe even though it came to me directly and indirectly on multiple occasions. I missed out on investing in it due to my blind spot with QR codes as I could not see a business being built on something as simple as a QR code," he recalls.
He has also tried a hand at investing in late-stage tech start-ups that were close to an IPO. "I invested in Lyft before the Google round and was made to hold my position for six months from the IPO. I'm glad that I walked out at the right time though with a meager profit," says Damani.