What India's Investors Think
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The Entrepreneur India Annual Conclave is one of the most revered ones for the team as they get to put in their might of the entire year. Year after year, the Conclave has seen some of the top investors interact with a bunch of delegates who are waiting to startup & start BIG.
The year 2019 will mark the 9th year of the Entrepreneur India Annual Conclave & needless to say it attempts to bring together the best of the top funds and VCs investing in the vibrant startup ecosystem of India.
From Sandeep Murthy of Lightbox Ventures to Ashish Fafadia of Blume Ventures, 2019 too will help the Entrepreneur India community interact with the country minds that make key investment decisions.
MANAGING DIRECTOR, ENDIYA PARTNERS
Sateesh Andra loves entrepreneurs with grit, clarity, and focus on execution. Technology start-ups with strategic focus and clear value proposition drive Sateesh. His investing, co-founding, leadership and engineering experience, for the past twenty years in U.S/India, all veer around technology. Currently, he is Managing Director at Endiya Partners, a Venture Capital fund that invests in Product Startups across Technology, Healthcare and Consumer Sectors. Some of his investments include Kissht, Darwinbox, Cygni Energy, AlphaICs and Slang Labs. Sateesh was Founder/CEO of Euclid, a Silicon Valley start-up, in the IT Management Software space and was instrumental in raising VC funding ($35 M+). He has also worked at DFJ, LSI Logic, and VLSI Technology. Sateesh holds a Bachelor's and Master's Degree in Electrical Engineering. Sateesh was a top-ranked Table Tennis player representing A.P State in Nationals.
PARTNER, LIGHTBOX VENTURES
As an early investor in InMobi and InfoEdge, two of India's billion dollar technology companies, Sandeep Murthy is one of the builders of India's Internet economy. And he hasn't just seen the highs and lows play out as an investor, but actually roughed it out in operational roles including one as the CEO of Cleartrip in 2006 for three years.
After teaming up with a friend to build a digital music company that was incubated by Sony Music – 10 years too early. He ended up selling the company to Sony after the Internet bubble burst. After a few years of living the Bay Area dream, he moved to New York to join InterActive Corp (IAC) the owners of Expedia, TicketMaster, Home Shopping Network where he helped launch Gifts.com. He started to explore the India technology opportunity and ultimately moved to Mumbai to manage investments for Sherpalo Ventures, a fund based out of Menlo Park in California.
Murthy has raised over $350M from leading investors. His most recent investments include Droom, Faasos, Furlenco and AI-platform Embibe, which got a $185 million investment commitment from Reliance, India's internet super power. This is the largest AI investment in edtech any where in the world.
PARTNER, BLUME VENTURES
Ashish, Partner, Blume Ventures manages Growth companies and portfolio companies that are headed for Exits and Fundraising for Portfolio companies and the Fund. An early member of Blume since 2012, Ashish led the establishment of Blume’s platform and support services arm, Constellation Blu - a 40-member team providing a wide range of advisory services such as transaction support, regulatory and compliance services; and since 2016 talent management for portfolio companies.
Prior to joining Blume, he was part of Timesgroup’s Corporate team for 5 years and Treasuries of Standard Charted Bank as well as State Bank of India.
MANAGING PARTNER, WATERBRIDGE VENTURES
Manish Kheterpal is a private markets investor with over 15 years of experience in venture capital and private equity, and 6 years of operating experience in technology, telecom and education sectors. Manish has led and managed over $500Million of investments throughout his investment career, mostly in India and across the US-India corridor.
Currently he is a Managing Partner with WaterBridge Ventures, an early-stage VC firm focused on investments in India or in global companies with a strong India connect. His investments at WaterBridge include leading start-ups like Chalo, Dataweave, Magicpin, PocketPills, SocialCops, Unacademy and 9Stacks.
Prior to WaterBridge Ventures founding in 2016, Manish spent 11 years working in senior investment roles at Rho Ventures, Actis Capital and Providence Equity Partners. Manish’s achievements during this period included investments in Idea Cellular, Hathaway Cable (Providence); Phoenix Lamps, Dalmia Group (Actis); as well as BroadLogic, LightPointe (Rho).
MANAGING DIRECTOR, INVENTUS INDIA
Parag is a Managing Director at Inventus India, a venture firm that invests in entrepreneurs building tech-focused companies in India. At Inventus India, Parag is/was a Board Director at redBus (acquired), FundsIndia, Vizury/Lemnisk, eTechies (buyback), Power2SME, PolicyBazaar, Avaz, peel-works, Tricog and Worxogo. He is based out of Bangalore.
Parag made a foray into venture capital after his MBA in 1993. He started off with ICICI Venture (in Bangalore) and followed that up with stints at GE Equity (in Gurgaon) and Intel Capital (in Bangalore). Parag also worked, for two years, with Genpact in a commercial role.
FOUNDER & CEO, SINGAPORE ANGEL NETWORK
Satveer's vision has always been to enable impactful ideas. He is committed to doing so by leveraging his strengths to support entrepreneurs who aim to bring about fundamental change.
Satveer graduated from the University of Virginia (UVa) with distinctions. He is a founding member of McIntire’s Global Commerce Advisory Board.
PARTNER, NORTHWEST VENTURE PARTNERS
Mohan is a Partner at Norwest, Bengaluru office and serves as an advisor on investments in Technology, Software and Healthcare. Mohan advised NVP’s investment includeBorqs (Public) - an IoT platform company; Attune, CRMNext, Capillary, Manthan, Zenoti, ElasticRun – all SaaS platform companies; Perfint, Ovum, Thyrocare (Public)& Nationwide – Healthcare companies.
Mohan also invests& incubates very selectively tech companies in his personal capacity.His portfolio includes : AllgoSystems ( Sold to Visteon : VC ), Azingo ( Sold to Motorola: MOT ), Mobiliya ( sold to Quest Software ) , AllgoVision and TailsLife.
Previously Mohan served as Corporate Vice President of Mobile Devices at Motorola where he was instrumental in launching mobile phones for the Global market. Some of the hit products includes Moto V, Razr, Ming, Rokr which sold more than 300M+ units.
CO-FOUNDER & MANAGING PARTNER, ANKUR CAPITAL FUND
Rema Subramanian is the Co-Founder and Managing Partner of Ankur Capital Fund, Investing in disruptive innovations that will allow a billion or so aspiring Indians to fulfil their dreams. Their core sectors are agrii, health and technologies which enable the aspiring to become affluent. They go the extra mile to identify and nurture such entrepreneurs. They have been pioneer investors in these sectors, especially agri for the last 5 years. They have done 14 investments till date. Rema co-founded Ankur with a vision to use her three decade CXO and entrepreneurial experience to bring the tools to young startups to become game changers. She has worked across manufacturing, IT/ITES, edtech, taking young companies from scratch to midsize ventures. Having worked with both Indian and Global companies, she intends bringing her experience to scale these enterprises. She is a Management Accountant, ICWAI, ICS and Systems Management.
PARTNER, LIGHTSPEED VENTURE PARTNERS
Vaibhav is an entrepreneur first, physician by training, and a venture capitalist by chance. His career journey has been rather unconventional: at 21 he dropped out of clinical training in the US to start Prima Clinics, a network of tech-enabled clinics, in Gurgaon; he also led growth projects for fintech startup Stride in the Valley, and later advised Fortune 500 clients at McKinsey’s Palo Alto office. He got his MBA from the Stanford GSB and co-founded Comfort, a care marketplace for elderly, while on campus.
To know what investors have said at Entrepreneur Annual Conclave 2018 that came true, slide through.
Rajesh Raju - Kalaari Capital
While speaking to Entrepreneur India at the Entrepreneur India Conclave 2018 Rajesh Raju, Managing Director, Kalaari Capital spoke about the three sectors in India that have high growth potential. In 2019, we understand how he had been correct.
"Logistics is one not just e-commerce space but overall Indian logistics have to get better, we have invested in some. We will continue to invest more."
"We have been focused quite heavily on fintech over the last three years. In the current fund, we are primarily investing in technology that has enabled the financial service industry rather than the lending side. It is a massive market in India and the ceiling is quite high. Our technology can bring the change in India."
"We are quite excited about the third one, which is definitely digital content. We have massive amount of connected users. Now I think content, especially on digital side, is going to be the first thing the Indians are to be exposed before they transact, I think there are going to start reading and seeing things.” He said.
Q) How can investors shield home-grown companies from global competition
A) I think we are in a democratic country, we also believe in capitalism in the free market, I think we should continue to believe that, India doesn’t need to shut down to global market like china and it did help local ecosystem it’s ok for the competition to come in, I think you build better product and service when you have external competition and the most evolved companies and most competitive companies will come to India, when they come from the US or Europe it’s okay to take up competition the Indian market has to deepen and continue to believe in capitalism at free markets some senior executive whose running Indian operation for a US company, I believe the entrepreneur will be more nimble and they better understand the Indian market they can always out execute foreign companies because foreign companies are run by the professionals, not by the passionate entrepreneur, I don’t think we should be afraid of competition we need to be better, we understand India better than they do we have entrepreneur running our companies, not professionals.
He explains that there are passionate and focused entrepreneurs who run the companies and they take keen interest in running the company. Also India is not afraid of competition as competition will always strengthen the companies working and in return will offer good products and services to the customers.
Q) How can Indian entrepreneurs survive in a competitive market
A) M&A market is not deep enough in India. l think market has to mature a lot and M&A market has to get deeper because money coming in is not the only thing money needs to go out and recycling is very important, otherwise we will be stagnant just like companies get stagnant when there is no recycling, when there is no new ideas or no new flows, Indian companies will know whether they need to be acquired or not, either you eat your competition or you get eaten , it’s a natural way you don’t plan for these things if you are not ahead you will be acquired by someone
Prashanth Prakash - Accel Partners
While speaking to Entrepreneur India at the Entrepreneur India Conclave 2018 Prashanth Prakash, Accel Partners spoke about Accel's 10-year journey and the way the VC firm has groomed the ecosystem.
"It has been a 10-year journey for Accel. We have invested in about 130 companies. If you look at the maturity of the entrepreneur, when we started then and now there’s a tremendous change, so I think we have learnt a lot from each other. I think I would say in a scale of one to ten when we started we were three to four in terms of maturity and comparing our self with the global peers we are seven and eight, so I would say we are developing fast, talking about the Indian Entrepreneurial Ecosystem’s Development information sharing has become easier.
Ecosystem has matured over the years, Entrepreneurs are absorbing the best from everywhere.”He explains that the Indian entrepreneur is developing fast that’s because sharing of the information has become easy also the ecosystem has improved over the years.
Q) Which sector can build itself globally?
A) There are two sectors one is SaaS Space, it is ripe for entrepreneurs to build from India for the rest of the world very quickly, the opportunity is in South East Asia and other parts of the World. There’s a company called CleverTap which is really dominating the market tech space in South East Asia, there is a company called Zenoti which is beyond the basics. There are numeral example of SaaS business some of the consumer businesses are slightly tougher to take globally because the dynamics and realities of consumption are different I see some of the consumer industry probably going to Indonesia and closer places but it’s that SaaS businesses and healthcare businesses also have shown India is a better place for initial research and development and then take that IP and repurpose that IP in other parts of the world.
Q) Which sectors are slated for growth in Mid-Term?
A) We think B2B businesses in India, Indian enterprises have woken up to the technology they are not ready to pay a lot upfront. For example, Blackbuck which is technology-led trucking marketplace, bringing transparency and efficiency in a decades-old industry. There are many companies which are emerging. The agro space is very exciting - Accel Partner’s Portfolio (Agro) like Agrostar, Samunnati, Ninjacart and the whole farm to the kirana and SaaS is still early the entire enterprise space globally constantly goes through shifts there are opportunities for the Indian entrepreneur.
Q) What is the rationale behind selecting a company for investment?
A) We are largely investing in the early stage so in the early stages three things that matter to us the market opportunity(Latent and Development), quality of entrepreneurial team and third the early signs of execution.
Vinod Murli - Alteria Capital
While speaking to Entrepreneur India at the Entrepreneur India Conclave 2018 Vinod Murali - Managing Director of Alteria Capital spoke about why Venture Debt is interesting and the need for them can’t be ignored today.
When we started in 2008, there was little of venture capital and none of the venture debt. Their venture had typically worked very close with Korean technology and with patent and so on and India is a very different market. It took us some time to figure out what will be the surrogate for IP in India in a sense how venture capital has evolved in India, India is not a market for a garage startup building, huge product companies these are execution players solve real world problem with technology.
We had the same evolution and over time understood there are clear differentiating factors for companies - these are non profitable, asset line and go against the grain of debt but you are able to understand them well enough to put this structure to work all asset classes take time to evolve so we wanted a robust venture system we needed founders to be aware of their product. It has been 10 years of working hard at it, now we have a very good understanding of how can venture debt help company, how it can extend runways. It is important to work with partners venture debts, which needs a very robust venture equity ecosystem.
You need to understand what happens when companies don’t plan to perform both from a founder and VC perspective. It is a triangular approach we work for the same team. Our idea is to solve the problem rather than creating a problem. If we talk about Alteria’s Fund Structure INR 800 cr fund and INR 200 cr greenshoe fund, generated funds from institutions, large families, from the company side it is very clear that there is a need for the capital. It’s a cheaper form of capital compared to equity and of course there’s one more partner onboard who can help you in the growth of the company.
Q) Is the extension of your work form of turning around the company?
A) Many of the companies that we fund end up burning through their cash. There’s a little bit of period when they need to survive on fumes in a sense so it’s about managing those difficult situations, which have helped us get to where we are, the founders understand there is a high level of empathy there is a recognition that we are playing in the team that the core philosophy. How venture debts help in turnarounds is by recognizing fundamentally strong businesses and help them through tough times.
Q) With respect to India, where do you see venture debt headed?
A) If I look at the next ten years, $20-30 billion of capital will be coming into companies at a seed stage and 15 per cent of that we are talking about a 200 billion dollar market. We are just getting started so there is a lot of potential to grow both equity and debt perspective. There is a better understanding of what it takes to scale a business and team competency.
We have 10 years of data which is helping a lot of founders come out of situation as an ecosystem. We are evolving and learning to mature but we are still getting started. I think there's a lot of demand both for companies and for capital and a lot of capital is available as well so venture debt is a multi-crore market. Over the next few years there are a few more players, there's an interest in the space and I think competition is good - it is a good signal.
Ashutosh Sharma - Naspers
While speaking to Entrepreneur India at the Entrepreneur India Conclave 2018 Ashutosh Sharma, India Head of Investments at Naspers explained the rationale that goes behind making an investment.
Data reveals that after having made an early investment in Chinese internet company Tencent, which turned out to be extraordinarily successful; as of 2018, Naspers has an approximately 31 per cent stake in Tencent, and is, by far, the largest shareholder of Tencent stock.
In its India portfolio, Naspers made its big splash last month with an investment of $1 billion in India's foodtech giant Swiggy.
While the company’s operations are in the internet communication, entertainment, gaming and e-commerce space, its focus on technology is clear. Founded in 1915, Naspers is a global internet and entertainment group and one of the largest technology investors in the world.
It is listed on the Johannesburg Stock Exchange and has an ADR listing on the London Stock Exchange.
“We work on a deal-by-deal basis; we don’t have a fund and therefore that gives us the flexibility to go slow when we don’t want to be aggressive. The second point is we don’t have a geographical allocation so if we find an interesting opportunity in India we will get it,” Sharma said.
He spoke about the two filters for the company for investment – one is consumer tech and the second is large opportunity.
Rationale Behind Investment
Naspers is one of the largest technology investors in the world, seeking to invest in companies with the greatest growth potential.
‘We are investing for returns but for absolute gains too because any investment Naspers makes must make an impact on its market cap and therefore a large space, slightly mature company and growing nicely is what we look for,” explained Sharma.
According to him, Naspers takes keen interest before investing and investigates minutely on the feasibility of the project it invests in, the companies that have the potential and Naspers’ aspiration for not only return but also seek gains.
Sharma said India has been very successful – we have portfolio companies like Swiggy, MakeMyTrip, PayU, OLX – so all top companies.
He sees India as a massive growth opportunity in the near future. “Appropriate regulatory environment and matured entrepreneurs will contribute to the nations’ growth; Naspers is looking forward to investing in India in coming years.”
Tej Kapoor - Fosun RZ
While speaking to Entrepreneur India at the Entrepreneur India Conclave 2018 Tej Kapoor, the current Managing Director and Head of Fosun RZ Capital India, spoke about how the company is looking to take Indian startups to the next level and help them leverage the knowledge that Fosun has from China.
Companies can go and work in China; also we are looking at how we can bring Chinese knowledge especially the technology side to India. There is so much depth of information when I travel to China. I see them so much ahead of us; at least a ten years ahead of us.
In his two years at the company, Kapoor has been scouting for innovative enterprises to invest from seed to IPO stage, all with high-growth pattern and sustainability of the business model.
Fosun RZ is a global-tech fund with teams in the US, South East Asia and China. The fund has made a total of 80 investments, out of which 60 are in China and the rest around the world.
With its eyes on early and growth-tech companies in India, the equity investment institution’s current portfolio in India includes Gland Pharma, Delhivery, Makemytrip, Ixigo and Kissht among others.
What is Fosun RZ’s Pick?
Besides real state and healthcare, there is no marking for India besides for technology companies.
“We are evergreen sort of a fund and what happens is we invest where its required; like I said there’s no ticket size issue, so we can go from small to big generally in the tech side,” Kapoor said.
The company likes come in early and late stage. In early stage, it helps the company grow faster and in the late stage, it comes in when the companies want to expand the business. The companies can then go to China.
In terms of fund philosophy, the fund is ready to invest from $1 million to $100 million. Kapoor says entrepreneurs should look at Fosun RZ not as a fund that is aggressive for an exit. “We stay with the entrepreneur for a long time, however we are centrally-focused about the returns,” Kapoor said.
Akshay Bhushan - Lightspeed Ventures
While speaking to Entrepreneur India at the Entrepreneur India Conclave 2018 Akshay Bhushan, Partner at Lightspeed Ventures spoke about which sectors in India are slated for growth.
Right now, given the Reliance JIO explosion, I am seeing a lot of attraction around content, especially vernacular content. We have a couple of portfolio companies in that space as well. Besides that a big change in B2B business everyone is connected. Down from the smallest SMEs up to the large enterprises, suddenly people's willingness to adopt technology has increased and even if I look at LightSpeed, in the last one year our bulk investment is on the B2B side. That wave is going to continue.
People are well-connected now operating at small scale as well as large scale, also people's readiness to adopt the technology.
Q) What potential do sectors like health-tech hold?
A) India as a country is very credit-starved and both on the B2B idea and the consumer side. At present, a massive opportunity for fintech companies exists. There is immense opportunity in lending and that has gone through a fintech wave. In health-tech, from a market perspective a lot of gap exists in the healthcare infrastructure. Entrepreneurs are most suited to solve that problem.
Q) What’s better, being an entrepreneur or investor?
A) Entrepreneurship never goes but I love investing, it is one place you get to meet smart entrepreneur and intellectually really challenges you as well and I don’t think so there’s any other role in which I could learn so much.
I love to invest as it makes me know the smart entrepreneurs, explore their ideas and thinking process. It is the wisest way to learn about the new things.
Q) The right way for entrepreneur to raise capital?
A) Typically fundraising process is a long process. If you are planning to raise, start early three to six months in advance because by the time you get the term sheath and by the time money hits the bank it could be as long as six months and the second it is important to know the investor as they invest in known people. He said that it’s very important to invest where you know the people well in terms of their business idea and their technological update. Also the process they adapt to serve the market.
Sanjay Kukreja - ChrysCapital
While speaking to Entrepreneur India at the Entrepreneur India Conclave 2018 Sanjay Kukreja, the Chief Investment Officer at ChrysCapital spoke about the secret formula of investment.
ChrysCapital is India-focused private equity firm that partners with passionate leaders to build world class companies. We have been around for almost nineteen years, we are a sector-focused fund. We have deep sector coverage around the consumer, financial services, business services, pharma, healthcare we look selectively at manufacturing and other areas as well in general we look at high return capital services we have deep sector experience and expertise.
Q) What is your view on mergers and acquisitions in India?
A) We have had, as a firm, now 65 exits. We have taken a lot of companies; 11 companies have gone public. It has been a mixed spread, IPO has been a good area for exits from our perspective pharma, healthcare, business and IT services have been acquisitive areas so we can build a business we have recently sold a business called Liquid Hub to Capegimini for almost half a billion dollars, so you can build a company in a certain areas, companies disrupting a certain niche become more open to M&A.
Q) When you invest in a company what do you look at?
A) First and the foremost thing is that we look at the leadership, governance, energy level, capital, mode of business and sector of focus, scalability and margin of safety and what business mode you have and which sector are you going for are they scalable and of course the valuation.
He explains when they look for any investment in any business they make sure they consider the working style of the entrepreneur also how focus and passionate a person is about his vision and the idea that he is working upon also they make sure that the venture is feasibility and ofcourse what is the value of the business and the rate of return Chryscapital is going to get from where it will be investing in.