The Desi VC with Akash Bhat

Chinnu Senthilkumar is the General Partner and CTO at Exfinity Venture Partners, an Enterprise Tech focused VC fund with an emphasis on startups in the US-India corridor.

Prior to Exfinity, Chinnu held Senior Executive roles at Intel, SanDisk and Texas Instruments, both in the US and India. In the capacity of SanDisk’s Country Head, Chinnu spearheaded SanDisk (now part of Western Digital) India operations in the areas of R&D, Operations and IT outsourcing. Chinnu is an innovator from a young age and received "National Technology award" from President of India at the age of 21. He has received his Masters from University of Utah, Salt Lake City, US and B.E. from College of Engineering, Guindy, Chennai.

You may follow Chinnu (@chinnusenthil1), host Akash Bhat (@bhatvakash) and our podcast (@thedesi_vc) on Twitter.

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In this episode, we will cover:

1. Current VC landscape in India (2:27)

2. Chinnu’s background (12:04)

3. Consumer vs Enterprise startups (16:10)

4. Investment strategy and criteria at Exfinity (22:00)

5. Dissecting deals won or lost i.e. using post mortem to analyze fund performance and strategy (27:38)

6. Corporate VC vs traditional VC (31:01)

7. The role of a GP and how they raise funds (34:04)

8. Time allocation as a GP (40:04)

9. Raising funds –– which is the toughest, the first or the subsequent ones? (44:05)

10. LP communications –– best practices with existing investors and how to handle conversations with potential LPs (45:55)

11. GP commitment and benchmarks (53:23)

12. Rapid fire (56:42)

Anup Jain is the managing partner at Orios Venture Partners, a VC firm investing in B2B and B2C startups with offices in Mumbai, Bangalore and Delhi. Anup leads their FMCG and Retail investments and has over 20 years of experience of building brands across countries and categories.

Follow Anup (@AnupOrios), host Akash Bhat (@bhatvakash) and the podcast (@thedesi_vc) on Twitter.

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In this episode we will cover:

1. Covid impact on Orios and the VC industry (1:15)

2. Anup’s background (23:28)

3. FMCG & Retail investment in India (32:30)

4. FMCG investments: contrarian or not? (43:45)

5. What do investors look for in FMCG startups? (48:41)

6. Subscription vs non-subscription vs Digitally Native Vertical Brand (DNVB)? (54:10)

7. Will Orios invest in a brand that doesn’t have an online presence? (1:00:01)

8. How do you scale businesses with moats such as data, distribution and personalization (1:16:55)

9. Rapid fire (1:08:58)

Sushma Kaushik is a Partner at Aavishkaar Capital, an early-stage venture capital firm currently deploying out of its 6th fund and has close to half a billion dollars in AUM. She has over 18 years of diverse experience in the field of early stage investing, small business incubation and consulting across sectors.

She is an engineering graduate from RVCE, Bangalore and has an MBA from the Indian School of Business, Hyderabad.

Follow Sushma Kaushik (@sushmakaushik1), host Akash Bhat (@bhatvakash) and the podcast (@thedesi_vc) on Twitter.

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In this episode you will learn:

1. Sushma’s background (3:58)

2. What Sushma loves about her job as a Partner (6:21)

3. What does a Partner do at a VC firm? (7:20)

4. First check written by Sushma (9:55)

5. How do you convince fellow Partners to invest in an under-performing sector and justify the investment? (12:06)

6. Learnings from investing (13:36)

7. Aavishkaar Capital and their thesis (15:45)

8. Challenges within the Impact Investment space (21:15)

9. Should seed-stage investors also consider growth-stage investments? (24:34)

10. How do you measure impact? (26:47)

11. How often do investors track the metrics? (29:54)

12. What is corporate governance for startups? (32:35)

13. What is the relationship between investors, board members and executive leadership within a startup and who calls the shots once investors’ share in the business exceeds the founders? (41: 32)

14. How do we solve for diversity within venture capital? (44:38)

15. Rapid fire (49:00)

Piyush Puri leads the Brand Capital International team in Silicon Valley as Vice President of BWI, the strategic investment arm of The Times Group – India’s largest multimedia conglomerate. Before leading Brand Capital’s US office, Piyush was an investment banker in Mumbai, India focusing on investments in the energy, ancillaries, and the environment spaces. Piyush received his degree in Civil Engineering from Indian Institute of Technology (IIT), has an MBA from XLRI Jamshedpur, and a Master’s Degree in Psychology of Leadership from Penn State University.

Follow Piyush (@Piyushpuri13), host Akash Bhat (@bhatvakash) and our podcast (@thedesi_vc) on Twitter.

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In this episode we will cover:

1. Piyush’s background (2:59)

2. How does Brand Capital International help startups tap into the Indian market? (5:56)

3. What do startups get wrong when they think about the India opportunity? (9:36)

4. How does BCI approach investments? (12:17)

5. What do non-Indian startups offer than incumbents don’t? (14:28)

6. What’s the best outcome for non-Indian startups entering India? (18:42)

7. How does BCI measure success of their portfolio companies? (19:45)

8. How do portfolio startups measure the impact of BCI? (21:06)

9. When’s the right time to think about global expansion (23:36)

10. Is having ‘feet on street’ important when startups go global? (26:00)

11. Internal reporting and accountability with respect to investments (27:59)

12. How has the pandemic affected BCI and their co-investors during the lockdown? (30:35)

13. BCI Portfolio: Does higher valuation (by non-Indian VCs) deter future investments from Indian VCs? (33:47)

14. Rapid fire (38:20)

Rohan Malhotra is the co-founder and Managing Partner at Good Capital, a Delhi-based early stage fund which takes a bottom-up approach to problem-solving and values first-principles thinking. Prior to Good Capital, he co-founded Investopad, a seed-stage technology incubator that focused on ventures that were centered on solving India-centric problems.

You may follow Rohan (@r0hanmalhotra), host Akash Bhat (@bhatvakash) and our podcast (@thedesi_vc) on Twitter.

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In this episode we will cover:

1. Intro (1:50)

2. How did the name ‘Good Capital’ come about (3:54)

3. What was the motivation in starting Investopad and then Good Capital (8:10)

4. How do two young people in their 20s start a fund without prior experience in building companies or managing funds (14:01)

5. How Investopad’s success became the foundation for Good Capital (16:38)

6. Fundraising challenges for young first-time fund managers and alignment with LPs (19:27)

7. Good Capital: Investing thesis (21:12)

8. How does a deal like Meesho come along? (22:58)

9. What is a ‘first-close’ from a fund-raising perspective? (33:07)

10. How long does it take to close the complete fund-raise for a fund? (34:55)

11. Portfolio construction at Good Capital (38:22)

12. Rapid fire (40:42)

Vinod Murali is Managing Partner and Co-founder of Alteria Capital. Vinod has 15+ years of experience spanning Venture Debt, Mezzanine Capital & Structured finance, Corporate Banking and Branding. Prior to Alteria, he spent time as the Deputy CEO at InnoVen Capital India (prev. known as SVB India Finance), and before that, at Citigroup as part of the Corporate and Investment Banking Group where he managed large Corporate relationships across Auto, Healthcare and Consumer industries.

Follow Vinod (@vinodmur) and host Akash Bhat (@bhatvakash) on Twitter.

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Glossary of terms:

1. Venture debt: Venture debt is a form of debt financing for venture equity-backed companies that lack the assets or cash flow for traditional debt financing, or that want greater flexibility. It is a form of “risk capital” that is less costly than equity when structured appropriately.

2. Burn: Amount of monthly cash that a company spends

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In this episode, we will cover:

1. Vinod Murali’s background and the birth of Alteria Capital (03:28)

2. Reason behind Silicon Valley Bank’s exit from India (11:20)

3. History of venture debt in India (14:44)

4. Reasons venture debt doesn’t sit well with traditional banking institutions (22:25)

5. Parallels between venture debt and equity financing (29:05)

6. How are debts structured? (33:27)

7. What are debts repaid? What is the typical interest rate? (36:00)

8. How are warrants / dilution structured? (38:01)

9. Debt arrangements that have gone well and those that haven’t and why? (40:38)

10. Why don’t debt financiers usually take board seats? (44:28)

11. Are personal guarantees eligible in a venture debt scenario? (48:00)

12. How does a deal like Dunzo come along? (49:44)

13. Rapid fire (52:36)

Alex Lazarow is the Investment Director at Cathay Innovation. Prior to joining Cathay Innovation, Alex was a Principal at Omidyar Network, a global philanthropic investment firm. While at Omidyar, he focused on investments in the global FinTech and financial inclusion space across the U.S., Africa, Latin America, and Southeast Asia.

He is also an adjunct professor specializing in impact investment and entrepreneurship at the Middlebury Institute of International Studies at Monterey. He is a Kauffman Fellow, CFA Charterholder, and a Stephen M. Kellen Term Member at the Council on Foreign Relations. He earned an MBA from Harvard Business School and a B.Comm from the University of Manitoba.

Follow Alex (@Alex_Lazarow) and host, Akash Bhat (@bhatvakash) on Twitter.

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Glossary of terms:

1. Network Effects: Network Effects is a phenomenon whereby increased numbers of people or participants improve the value of a good or service.

2. Impacting Investing: Impact investing refers to investments made into companies, organizations and funds with the intention to generate a measurable, beneficial social or environmental impact alongside a financial return

3. Blitzscaling: It's the science and art of rapidly building out a company to serve a large and usually global market, with the goal of becoming the first mover at scale; an accelerated path to the stage in a startup's life-cycle where the most value is created.

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In this episode we will learn:

1. Alex Lazarow’s background (3:20)

2. Why did Alex decide to write ‘Out-Innovate’? (7:00)

3. What are ‘Frontier Ecosystems’? (9:34)

4. Similarities between emerging markets around the world and emerging markets within the US such as mid-West (11:53)

5. Learnings from speaking to Indian entrepreneurs about ‘sustainable’ growth (14:38)

6. Misconceptions about Blitzscaling (18:22)

7. Challenges in building global companies (22:04)

8. How should entrepreneurs think about the global opportunity and get it right? (25:15)

9. Bottlenecks in building sustainable businesses (28:10)

10. Is real innovation taking place outside the Silicon Valley? (31:16)

11. Misconceptions Alex had about emerging markets before writing his book (33:40)

12. How has Alex changed through his experience of writing the book? (35:15)

13. Rapid fire (38:10)

Pankaj Makkar is the Managing Director, Bertelsmann India Investments, a strategic investment arm of Bertelsmann SE & Co. KGaA in India, focusing on investments in the digital, education, media and services sectors. He’s spent his career at Astro, Univision and has been at Bertelsmann for the last decade. He holds a B.Comm Hons. from Delhi University and received his MBA from Harvard Business School.

Bertelsmann India Investments has several startups in its portfolio including Licious, Saavn, Pepperfry, and Quikr.

Follow Pankaj (@_pankajmakkar) and host Akash Bhat (@bhatvakash) on Twitter.

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Glossary of terms:

1. Growth stage: Growth stage investment firms invest in well-run, growing businesses with proven business models and solid management teams looking to continue driving the business. Series B and beyond rounds are usually termed as ‘growth stage’.

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In this episode we will cover:

1. Pankaj Makkar’s background: (00:19)

2. COVID-19 impact and the current state of work: (1:26)

3. How has venture evolved in the last decade: (3:02)

4. In this new normal, what are the learning from market perspective and VC Opportunities: (6:07)

5. What is nature of conversations right now with portfolio companies: (8:17)

6. Thoughts on sectoral thesis for post COVID world: (9:16)

7. Evolution and current view of India VC market: (12:21)

8. Why is it hard to multiply fund returns: (14:56)

9. How do you do diligence for portofolio companies: (17:52)

10. What diligence data points and methodology: (18:18)

11. For companies already invested in, how do you mitiagte risk: (21:25)

12. Investing in growth stage companies for consumer vs enterprise technology companies (25:10)

13. Bertselmann’s Fund-of-Fund (FoF) strategy for investing in other funds: (26:48)

14. EdTech and the constant disruption in the space: (34:29)

15. Rapid-Fire - (40:48)

Ankita Vashistha is the Founder and Managing Partner at Saha Fund, a fund that invests in early stage tech-startups run by women entrepreneurs. Ankita comes with a background finance having spent time working in venture capital and private equity before co-founding Saha Fund along with her partner, Usha Amin.

Follow Saha Fund (@sahafund) and host Akash Bhat (@bhatvakash) on Twitter.

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In this episode we will cover:

1. Ankita’s background

2. Covid-impact on the venture industry

3. What is Saha Fund and what’s special about it?

4. Why diversity in investing matters in today’s context?

5. How can VCs accommodate more diversity when it comes to investing in India?

6. Challenges in fundraising as a fund manager for a women entrepreneurship venture fund

7. What can Indian VCs learn from success of Nyaka, CashKaro, Rivigo

8. Sectors that Saha Fund focuses on

Ishpreet Singh Gandhi is the Founder and Managing Partner at Stride Ventures, a venture-debt fund focused on lending to growth-stage startups with investments in companies such as Bira and Stellapps. He brings over 13 years of experience encompassing Banking, Private Equity and Venture Capital. During his last stint as Regional Head (North & East) at IDFC Bank, he spearheaded startup business by initiating lending business across Fintech, Consumer, Logistics and Agritech space. He has completed his Post Graduation from Delhi University (Delhi School of Economics) and Bachelors in Commerce from Delhi University.

Glossary of Terms:

1. Venture Debt: Venture debt is a form of debt financing for venture equity-backed companies that lack the assets or cash flow for traditional debt financing, or that want greater flexibility. A complement to equity financing, venture debt is generally structured as a three-year term loan (or series of loans), with warrants for company stock. Overall, venture debt is a form of “risk capital” that is less costly than equity when structured appropriately.

2. Covenant: Debt covenants are restrictions that lenders (creditors, debt holders, investors) put on lending agreements to limit the actions of the borrower (debtor). In other words, debt covenants are agreements between a company and its lenders that the company will operate within certain rules set by the lenders.

In this episode we will cover:

1. Ishpreet’s background and entry into venture capital

2. What are the differences between equity-based financing and debt-based financing?

3. What kind of startups qualify for venture debt

4. In spite of being founder friendly, why isn’t debt financing more popular than it should be

5. What steps is Stride Ventures taking to make debt financing mainstream?

6. How important is the cap table while evaluating a startup during debt financing?

7. When should a startup think about venture debt?

8. How does venture debt economics work?

9. How much should a startup at Series A raise in debt financing

10. Is venture debt for everyone? Are there downsides to it?