My Funding Picks of Last (two) Weeks (w13 & 14)

After the turbulence of the last few weeks, I finally carved out the time to share my funding picks of Week 13 & 14 of 2020.

My team and I shortlisted the deals for week 13 & 14 from Traxcn, Inc42, and YourStory and we jointly picked out the following as the best funding picks for 17th March to 29th March 2020 period:

 

Name: Qtalk

Amount Raised: $1.6 million from Accel India & Lightspeed Venture Partners

What does Qtalk do?

Edited from Traxcn: QTalk is a mobile application that provides calling for friends and family members. It allows users to make affordable local and international calls using phone internet/network or WiFi technology. Its features include call recording/history/remainders, caller ID, spam blocking, calendar integration, and others.

Why do I like Qtalk?

Qtalk brings an interesting tech layer on top of a regular dialup app providing smart features like silence overrides, shared browsing, and call intent. The app offers WiFi calling, which is a much-needed feature to overcome the overloaded network infrastructure in India today.

 

Name: MedCords

Amount Raised: ₹7 crores from InfoEdge India

What does MedCords do?

Edited from Traxcn: Medcords is a medical record management solutions provider for patients, doctors, pharmacies, and lab centers. Prescriptions, bills, personal information, etc. can be uploaded to the mobile app. Doctors can view the past medical history of patients and can access other medical records of the patients. Patients can view all information related to their health, and also pharmacies and labs can access the record to provide services to patients. Also, uses analytics and provides trends to doctors and patients

Why do I like MedCords?

Maintaining medical records is painful. To aggregate one’s medical information, prescriptions, blood reports, and past medical history into one space are even more painful. MedCords aims at solving this problem. It provides a one-stop solution for one’s medical needs, and once it reaches critical mass, the data analytics layers will pay rich dividends for the investor.

 

Name: PitStop

Amount Raised: $2.5 million from Group Landmark, Blume and Goldbell Group

What does PitStop do?

Edited from Traxcn: PitStop is a closed marketplace for car service providers. It provides an estimated cost of service and offers the option for doorstep pickup and delivery. Provides status tracking after booking service. They claim to have the service done in 2 hours. Pitstop has expanded to several locations including Delhi, Bangalore, Hyderabad, Mumbai, Pune, and others.

Why do I like PitStop?

I am not a big fan of the fragmented vehicular maintenance space. However, Pitstop’s substantial revenues numbers put them a cut above the rest. That is the reason why it is on my list. Pitstop wants to use the data reservoir created from its vast customer base to offer services like vehicular insurance, etc. If it can continue its phenomenal growth in the post-Corona phase – this one could be one to watch out!

 

PS: Artha Venture Fund invested in Agnikul, a deal that got announced a couple of weeks back. While I am a big fan of the team and the deal, I keep our investments outside the purview of these picks.

You can read Vinod and my reasons for investing in this detailed blog: Why We Invested in Agnikul?

Founder Playbook: Getting ahead of Covid-19

The aftermath of the pandemic spread of the Covid-19 virus has hit financial markets where it hurts the most – their ability to bank on the future.

These are unprecedented times as countries close their borders, the Italian government shuts down businesses, and schools, colleges, and universities are shutting their campuses and moving classes online. The disruption in business and how it will get conducted in the near term has created a tectonic shift that is rattling global markets.

When the most capitalized financial market in the world starts oscillating like a 5-year-old getting on a swing for the first time – it is time to sit-up and take notice.

Even we felt the tremors far away, i.e., in the venture capital ecosystem. Sequoia’s calling Covid-19 spread The Black Swan of 2020. This spread is dangerous, and the situation could spiral out of control – quickly.

Therefore earlier this week, Vinod and I had organized a conference call with Artha Venture Fund’s founders to address this growing situation and to work out how we could get ahead of the problem. Here is a brief synopsis of how our founders are tackling this issue (thank you, Arvind, for these notes):

  1. Do not panic but stay vigilant
    1. Keep an eye out for a demand drop in the next 3-6 months
    2. Respond to it quickly and decisively
  2. Remember that a typical downcycle in VC lasts for 18-24 months
    1. Survive this period, and you will thrive when the tide is back
  3. Investors are tightening their belts
    1. Be prepared for long delays in fundraising
    2. Drop-off in valuations
  4. Prepare fresh budgets
    1. Be conservative in revenue estimates
    2. Cut unnecessary & discretionary spends
    3. Find ways to control the burn, i.e., increase revenues or cut the costs
  5. Despite your best efforts if you envision run out of money in the next 6-9 months, then
    1. Raise an additional buffer right away and extend your runway to 15-18 months

As an optimist contrarian, an economic upheaval offers the best opportunity to gain on the competition. One must remember that people will continue to consume goods and services, but the way they consume it is going to change – temporarily.

A founder must watch the customer’s consumption patterns closely, prepare to pivot the business to serve his customer base, and capitalize – even in these adverse business scenarios.

A note: I do not attempt (in any way) to disregard the seriousness of this virus. The severest impact of this is on the part of the population that has pre-existing medical conditions. To me, it means that entrepreneurs are in the higher risk category due to entrepreneurial stress they undergo (I have written about in the past). The recent turmoil is just adding to that stress.

Therefore stay calm, stay positive, keep your ears close to the ground but keep your hands clean and off your face. 😊

A Pleasant Surprise on the Upside!

While redoing our website, I accidentally stumbled upon an interesting piece of information.

I wanted to create a portfolio filter that would allow a visitor to create portfolio cohorts using factors such as the year of our investment, whether we were current investors, which startups we had exited from, or which sector the startup operated in and so on.

While tagging the startups, my team discovered that 4 of Artha Venture Fund’s portfolio companies had at least 1 female founder, i.e., 66% of the fund’s portfolio! This statistic piqued my interest as I stress the importance of being gender-neutral when it came to choosing our founders. Yet our female founder representation was far higher than the 20% female founder representation reported in CrunchBase EoY 2019 Diversity Report published in January 2020.

I dug further to look into our upcoming pipeline, which told me that out of the 5 deals which were at an advanced stage of closure, 3 deals had at least 1 female in the founding teams – 2 where the female founders held the CEO position!

I still felt that my sample size was too small to form an opinion. So I widened my search. My team & I started an investigation into my previous portfolio that I had set-up through our family office, i.e., Artha India Ventures.

The team keeps granular information on my past performance to report to institutions and family offices that need the information as a part of their due diligence. It took a few hours to figure it out, but 22 out of the 69 startups I had previously invested in had one female founder, i.e., almost a 33% representation!

MicrosoftTeams-image

The team went deeper to uncover that the female founder cohort delivered a 41% IRR with 4.3x multiple on invested capital in comparison to an overall portfolio IRR of 56% with a 4.6x investment multiple. Though the female cohort performance is lower than the overall performance; it does not tell the entire picture.

Our 330x multiple in OYO skews the numbers in favor of the XY chromosome cohort, but several of our female founder companies are raising new rounds of capital. One of them is months from becoming a unicorn, so it is a matter of when (not if) when the female cohort will be the alpha for the portfolio. While an eye-opener, I am not proud of beating the gender bias – not this way.

What I am proud of is that diversity happened without gender bias in favor of the XX chromosome. I am very vocal in stating that we do not favor a particular gender in our employees or founders. I believe that being entrepreneurial is a gender-neutral trait, and to invest in someone because they have or lack a Y chromosome is foolhardy.

Despite these results, I continue to stand up for what I said in last year’s blog post, Why I refuse to promote Women’s Entrepreneurship. 

The moment that I start treating a founder differently because they are women, it means that I do not see them as equals. I will skew my thoughts to cater to my bias, and it will hurt them as much as it will hurt my bank balance.”

To investigate if my lack of bias was something I felt or did it percolate down to our treatment of our female founders, I asked my XX founders whether they felt any bias from our end. Besides, I asked them why they gave a seat to Artha for their entrepreneurial journey. This is what they had to say:

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WhatsApp Image 2020-03-09 at 7.24.53 PM

The diversity of the artha eco-system is felt in all the events we come together with Artha- where we meet entrepreneurs working on awesome ideas - pushing through- without feeling any differenc

In closing, while global reports state that the penetration of female founders in startups is very low, I have little concerns for the same. People whose investment lens has a filter against a particular group of people due to their color, country, or chromosome will lose out – lose big.

I am glad that our lens is crystal clear and that my team chooses the best people for the founder’s job. We follow an incredibly meticulous approach when it comes to choosing our founders.

Not always do we have the most qualified founders, but we attract the most passionate founders’ with a deep internal drive for the problem they are solving. We trust in our process of channelizing a founder’s energy to win one battle at a time and create category-leading companies.

Now if that means that our winning portfolio has a disproportionately high number of female founder companies – then so be it!

My funding picks from last week (w05)

There were 15 deals in week 5 of 2020 that were available on Traxcn, Inc42, and YourStory,
I sat with our funding team, and after some enlighting discussions, I have shortlisted my picks to:

Name: InterviewBit
Amount Raised: $20 million
Investors: Tiger Global Management & Sequoia India
What does InterviewBit do?
Edited from Traxcn: InterviewBit is an online platform for tech interview preparation. The platform offers gamified lessons with video tutorials, primer problems, and guided solutions for programming, scripting, databases, system design, puzzles, etc. The platform also enables the candidates to get connected with the right companies worldwide based on skills and preferences.
Why do I like InterviewBit?
I like focussed vocational plays. Last year I had picked out GreyAtom as a funding pick as it provided an upskilling platform for data science and web development employees. Therefore picking it isn’t a surprise that InterviewBit got selected even though the $20 million round from Tiger & Sequoia is bigger than a typical Series A round in India.
InterviewBit solves an exciting problem of finding, interviewing, and evaluating tech talent, which is the Achilles heel of the best of Indian start-ups. The CAC for such plays is quite high, but considering the 18-35 lakh rupee salary bracket they target, the rewards may outweigh the costs.
Only request – can someone create a platform for finance and accounting employees! 😊

Name: AdonMo
Amount Raised: Rs. 21.4 crores
Investors: Bace Capital, Astarc & Mumbai Angels
What does AdonMo do?
Edited from Traxcn: Adonmo provides an in-transit cab advertising platform for advertisers to reach their target audience. It enables advertisers to place their ads on top of the cab and select the target location and relevant time slots to display advertisements and track their ads in real-time. It uses a proprietary computer vision and hyper-local technology to identify its viewers and advertise.
Why do I like AdonMo?
It was unbelievable that I had created a business plan to provide contextual ads based on geo-location on top of taxis during a 6-7 months stint in Kolkata in 2012 or 2013. I had reached out to taxi-top display manufacturers in China who could provide the hardware required for this service. These plays were very popular for advertisers in Africa as most homes did not have electricity – therefore, taxi-top displays were the primary distributors of advertising. But AdonMo is precisely doing what I could not i.e., EXECUTE on the idea.
I am excited about AdonMo as it disrupts the hold billboard owners have enjoyed for several decades. A moving billboard provides better and deeper reach to advertisers with exhaustive reporting and must work out to be of much better value than a billboard.

Name: YoloBus
Amount Raised: Rs. 4.28 crore
Investors: Undisclosed
What does YoloBus do?
Edited from Traxcn: Yolobus provides an online-based platform for booking intercity tickets. Users can book tickets by giving details like location, date, time, etc. It offers features like real-time tracking, in-cabin Wi-Fi, Toilet, Pantry, CCTV cameras, etc.
Why do I like YoloBus?
There are several intercity bus services. So what is interesting about just another intercity bus service?
There are several intercity bus ticket booking platforms – So what is interesting about just another intercity bus ticket booking platform?
India is home to the world’s largest and fastest-growing middle-class population. India’s growth pulled 271 million people out of poverty between 2006 and 2016. It is only a matter of time before India’s per capita income will cross $4000 with and a majority of the Indians will belong to the middle to upper-middle class i.e., aspirational class.
This vast majority of people will have a very different consumption basket and preferences compared to the sustenance living Indian, and services like YoloBus cater to a growing section of the Indian audience.
While Yolo may get considered a bit ahead of its time, if it can keep its costs of operation and customer acquisition in control and sustain – there is a big market for it to capture!
One question, though – why are the investors undisclosed? The first time for me to see a release in which the amount gets disclosed but not the investors!  

My funding picks from last week (w03)

There were a lot of excellent deals last week for me to choose my picks. After shortlisting 15 deals from Traxcn, Inc42, and YourStory, I sat with our funding team, and after a lot of enlighting discussions, I have shortlisted my picks to:

Name: Numocity Technologies
Amount Raised: undisclosed
Investors: Ideaspring Capital, Rebright Partners, and ABB Technology Ventures

What does Numocity do?
Edited from Traxcn: Numocity Technologies is an early-age tech enterprise focused on providing digital solutions for electric mobility infrastructure. The company offers products for EV fleets like fleet chargers, central management systems, and battery swap programs.
Why do I like Numocity?
EVs are the future. I have a sizeable exposure to mobility tech through Everest Fleet, Rapido, and Oneway Cabs. I want us to grow our portfolio in EV, especially in the charging infrastructure space, which should do exceptionally well in the times to come – especially for large EV fleets like the one Numocity is targeting.

Name: Instoried
Amount Raised: Undisclosed
Investors: SOSV

What does Instoried do?
Edited from Traxcn: Instoried is an AI-based content optimization tool that evaluates writing standards. The platform analyses your written content provides a scorecard and feedback on how you can improve their written communication. The platform aims to monetize this through paid subscriptions.
Why do I like Instoried?
I am a Grammarly power-user, and I will refuse to write an email, blog post, or media article until Grammarly will approve it. Grammary offers a contextual scanner telling me whether my written post is information, official, negative, positive, or casual. What I like about Instoried (from its explainer video) is that it goes one step ahead and points out which words the scanner is getting its context from and how that can be improved. It is an intelligent tool but will have to see if it can be an intelligent company too!
 
Name: GoFloat Technologies
Amount Raised: 9 lakhs
Investors: Jito Angel Network
 
What does GoFloat do?
Edited from Traxcn: Manufactures and exports flotation and other water safety devices for emergency rescue situations. Their tools are compact, portable, and cost-efficient in comparison to life jackets.
Why do I like GoFloat?
Since there isn’t a demo product or video available on their website, the idea could be pre-product, and with the small funding round, I should have kept this deal out of this week’s list. But I can see a market for a GoFloat due to my love for water sports, liveaboards, and cruises as an avid scuba diver.
 

My Funding Picks from Last Week (W01)

The first week of 2020 was understandably slow for deal announcements with Yourstory reporting a 73% drop in funding from last week. It was slim pickings for me to choose my funding picks, and I decided to choose just one.
Aeron Systems raised ₹2 crores from Bharat Forge
What does Aeron Systems do?
Copied from Traxcn: Aeron Systems focuses on the development of technology, applying its expertise in embedded electronics to domains encompassing aerospace, automotive, renewable energy, and agriculture. The company offers products in two technology segments, Inertial Sensors, and M2M devices. The IoT solutions include wireless data loggers, wireless data gateway, vehicle health monitoring systems, and a wireless weather monitoring system.
Why do I like Aeron?
Artha manages 5 renewable energy projects, and for a long time, I had an analyst to log weather data sourced from weather.com with each daily generation report. We would find trends that gave us a good idea of the next day’s generation. However, the weather.com data wasn’t accurate as it did not capture the weather at the project location but from their closest available weather station.
Therefore and in all honesty, it was their Weather Monitoring Station for Solar Power Plants that lured me into learning more about the company. I asked the Artha Energy Resources team to reach out to them and get a demo for our current and future projects and see if it is cost-effective.
Looking at their product portfolio, getting investment from Bharat Forge is a masterstroke!

I liked FarmERP investment as I am interested in Farming as a Service. However, there was nothing shared on the amount of financing, and since the company is over 14 years old it outside the contours of how I would define an “early-stage” start-up.

Family & Friends – Please Save Your Capital!

A couple of months ago, I found my jaw hitting the floor during a start-up pitch. The founder of an early-stage B2C startup revealed that he had previously raised a family and friends’ round of the princely sum of 5+ crores (~$900k). That capital was exhausted in less than 18 months; the monthly burn was over 50L per month with a double-digit staff strength. All this effort was delivered less than 25 lakhs in sales – since inception!
Runaway spending, low traction, running out of cash are situations that I regularly encounter as an early-stage investor. What worried me was the lack of oversight the family and friends had on how the founder invested their capital and their lack of experience steering the founder from avoidable expenses.
For example, precious and expensive capital found itself funneled into:

  • A massive PR & Branding campaign which wasn’t delivery but continued to burn a hole every month
  • Lobbying for international “paid awards” that cost a bomb but did not deliver results.
  • Massive allocation on R&D, but it was a ruse. The money got spent on traveling to different countries to find manufacturers to white label their products to the company
    • I have seen others do it at 1/10th the cost & time

I cannot hold the founding team entirely at fault here too – part of the blame should be on the investor class. They infused excess capital into the business, thereby encouraging the founder to burn the money on things that don’t matter, ultimately setting up things to fail.
My presentation of these entrepreneurial misadventures is not an attempt to rub salt on the wounds of the family and friends’ investors or the founders.
I want to point out something fundamental. Except for unusual situations* family and friends must limit the amount of capital they commit to an entrepreneur. Leave the larger rounds of capital to the professionals. Not only will it save capital for generous family and friends, but it will also save founders from committing hara-kiri with their startup ambitions.
If this were a one-off situation, I would not have written about it, but I am witnessing a marked increase in the number of ventures backed by family and friends and coming to us for a seed round. We like family and friends supported investments because it shows that those closest to the founder also believe in them, but like healthy foods – too much green can be injurious to health.
Most of the time, family and friends judiciously put in a small amount of capital, just enough to get the venture started. However, there were many examples where family & friends have drowned a lean start-up culture with a deluge of capital – killing the enterprise and blowing away the capital.

So, the obvious question that arises is, how much should a family or friend commit to an entrepreneurial family member or friend?
The good news is that a family or friend need not look too far.

The best accelerator programs in the world, i.e., Y-Combinator or TechStars, commit $150,000 (~₹1 crore) for a 7-10% equity stake in pre-seed ventures. Similar programs in India like 100x.vc, Indian Angel Network accelerator, or VentureNursery (in the past) invested between 25-75 lakhs for a similar equity position.
All the branded investors mentioned above have many good and bad investments; therefore, with their experience, they can guide founders on promoting the right and shunning wrong behaviors in their start-ups. So, for inexperienced family and friends’ teams, the correct amount of capital would be between 50% to 75% of what these guys invest, i.e. anything in 40-75 lakh range.
Family and friends can decide where to invest in this range based on the domicile of the venture but ensuring that the founder has 6-9 months to find a professional investor while they continue to grow their start-up. It is the founders’ responsibility to consistently update their investors whether things are going well (or not). Developing this habit is vital but critical in case things are going well, but finding a professional investor is taking time. Family and friends could opt to put in some more capital IF they are comfortable with the start-up’s progress and are objectively taking the additional risk.
However, the family & friends’ capital tap must end at that.
 
* While It is still advisable to leave the more giant cheques to a professional but in certain situations, it makes sense for a more significant allocation from family and friends. These are exceptional situations, not the norm.

  1. If the family and/or friends have in-depth domain knowledge and are objectively backing one of their own
  2. In Meditech or Healthtech like start-ups that require more massive upfront investments and the family and friends’ investors have in-depth domain knowledge

My funding picks of the last week (W49)

Most funds are winding down their operations in December; therefore, there wasn’t enough funding news from which I could shortlist. Yourstory reports that there were 17 deals in total with less than 50% meeting the criteria of the early-stage deals for this section of this blog.
The launch of the first cohort of Sanjay’s 100x.vc should change that this week, and I should have a tougher job to choose my top picks next week!
 

Sarva.com raised ₹20 crores from Fireside Ventures

What does Sarva do?
Sarva is a wellness start-up that offers a wholistic ecosystem for mental, physical, and emotional wellbeing that utilize the ancient practices of Yoga. Sarva’s website claims to provide 25 forms of yoga taught through studios in 14 cities and has membership plans similar to Cure.fits memberships.
Why do I like Sarva?
The success of offline plays like Cure.fit and Bombay Shirts have brought back confidence in the augmented real estate brand plays.
Yoga has a mass appeal, and while Cure.fit does offer Yoga classes, I like the specific niche that Sarva’s is pursuing. Several Yoga schools in various cities provide personal trainers, but very few (maybe none) have tried launching a national brand like Sarva. The rest of the ecosystem is fragmented and regionalized.
I am a frequent user of Cure.fit (when I am in town) I love the flexibility of choosing classes that work with my schedule at a location closest to me on a given day. I suspect that with their war chest full of money, Cure.fit could quickly launch a Yoga studio vertical too. However, I suspect that the difference could be in the execution.
I found a Sarva studio in Nariman Point, and I will take a trial class to compare the two before I say any further.
 

Indyfint.com raised $2.1 million led by Saravanan Adiseshan

What does Indyfint do?
IndyFint offers a plethora of bank-like services for businesses (as per their website) as well as a marketplace to provide loans to merchants, employees, and students (as per the YourStory article.)
Why do I like Indyfint?
I am a big believer that the Indian banking system is ripe for disruption. Banks use IT systems, policies, and operating procedures that are decades behind the business requirements of today. Previously (and in frustration), I had written a wish list for what I would like for a bank to do for me (as a corporate customer).  Therefore I have a soft spot for those attempting to take on the big banks!
I am not 100% sure that IndyFint is attempting to become an alternative-banking platform but I like the services they offer on their website. Just like them, several other start-ups are trying to break the stranglehold created by Indian banks. I support the disruption, and I forward to helping one of these disrupters with our money as well!
 

Dhruvaspace.com raised ₹5 crores from Mumbai Angels

What does Dhruva do?
Dhruva builds nano-satellites that work with ground sensors (also produced by them) for applications in agriculture, weather monitoring, infrastructure, etc.
Why do I like Dhruva?
Space is the unclaimed territory. Nano-satellites flattens the playing field that was previously occupied by big corporations or large governments. With billions of dollars at their disposal to send up massive satellites, their money power acted as a moat to fully exploit real estate a few hundred kilometers above our heads.
Nano-satellites and alternative delivery mechanisms democratize access to space. They provide access to applications that were (until now) were outside the reach of most of the world.
I believe that the market for nano-satellites will be worth tens of billions soon and add to that this is an Indian company that is attempting to compete in this space (pun intended). It is difficult not to love that!
 
Artha India Ventures invested in Kratikal’s Pre-Series A round. The announcement took place last week, but I chose not to review that investment in this section.

My Funding Picks from Last Week (W48)

I am back with my favorite funding news of last week! I had shared my purpose in starting this weekly post, and I have received much positive feedback. Therefore, I was eager to dig into the top news from last week to share with you today.
Last week was a stellar week for fundraising, with over $1 billion raised. There is some deviation in that number as YourStory claims that the total was $1.18 billion, while Inc42* claims that the total was $1.08 billion. However, both agree that over 90% of the money comes from the $1 billion round for Paytm announced through VSS’ twitter handle.
However, Paytm does not fall under the parameters of an early-stage start-up; therefore, within the early-stage funding news for the week, these were my favorite:

Tripeur.com – $1 million from SenseAI, Better Capital, Patni Wealth Advisors, Incubate and Rajul Garg and Alacrity India

What is Tripeur?
Tripeur is a cloud-based corporate travel expense management solution. They utilize AI/ML technology to reduce corporate travel expenditure by 30% (as claimed) with better reporting and productivity gains for the travel admin. They claim to have served over 50,000 business travelers and booked 1.4 lakh trips for them through their online platform.
What do I like Tripeur?
I have slowed down investing in travel over the past few years, but it still makes up almost 25% of my overall investment portfolio. We evaluate travel start-ups as it continues to be a significant investment theme for AVF.
Within travel, I have found corporate travel to be the ripe space for disruption. I had identified corporate travel as the number 1 pain point to solve in my October 2017 post on the travel space.
While I haven’t utilized the Tripeur platform yet (I sent them a demo request over the weekend). However, I can speak from experience that a decent corporate booking platform can expect a very sticky customer base. They must provide access to the best prices with easy booking and cancellation options along with accurate reporting for the finance team.
These pain points are widely prevalent across all corporations, big or small. Therefore, people would readily refer customers to Tripeur if they can do what they promise, providing significant savings on CAC.
Tripeur could find much value in associating with many of my portfolio companies – Confirmtkt, Repup, OYO, VistaRooms, and others.

FirstU.in – undisclosed round from India Quotient, FirstCheque and Farooq Adam

What is FirstU? 
FirstU is an online platform that provides subscription-based periodic services for automobiles. Users buy monthly subscription plans and avail regular services such as vehicle inspection, repairs, washes, accident assistance, etc.
Why do I like FirstU?
Several start-ups attempted to solve the problems of the fractionalized vehicular maintenance space. Most of them tried to upgrade your neighborhood mechanic, but the cost of retraining and retaining them far outweighed the benefits provided to the revenue accounts. The few that have been attempting setting up a company or franchise-owned multi-brand workshops have done better, but even then, they continue to burn money.  Their LTV / CAC ratios are quite unfavorable as there is a long time gap between repeat services. Therefore, the start-up must resort to deep discounting to attract new or repeat customers.
I have written about my love for subscription start-ups as they develop the habit of their customers paying them. Once they form this habit, it takes a massive effort for a newcomer to “break” the psychological pattern of paying the same company. It creates the ideal “sticky” customer relationship. It is precisely the spending relationship that I love to see my start-up get into with their customers.
Once FirstU expands outside of Bangalore, I’d love to explore a B2B association between Everest Fleet and OneWay.Cab and them.

GreyAtom.com – $1.2 million from Montane Ventures, Pravega and Ritesh Arora

What does GreyAtom do?
GreyAtom provides a boot camp for learning data science and web development. The “students” work on real-world problems, get reviewed by their peers, which accelerates their learning curve. The claim to have upskilled over 35,000 learners with 87 percent making a career pivot of their choice.
Why do I like GreyAtom?
That working knowledge trumps the knowledge learned at a prestigious school is a known phenomenon. Therebefore the GreyAtom platform providing the workers of today the opportunity to upgrade and update their skills, but alongside their current roles is the need of the hour.
GreyAtom creates a win-win for the individual and the corporate. For the upskilled individual, it means better prospects at their current employer or the ability to switch over to a new role for which they were previously unqualified. For a corporate, incentivizing their existing team members to upgrade their skills would reduce attrition, improve job satisfaction, and reducing hiring and training costs. There is a lot to like about GreyAtom!
All I could wish for is that someone would come up with a similar platform to improve the skills for finance and marketing people. I’d be their first investor and a corporate customer for life!
*I am an investor in Inc42 through Artha India Ventures

My Funding Picks for Last Week (W47)

I am starting a new section for my blog.
Every Monday, I will share my favorite early-stage startups that have raised money (i.e., <Series C) in the last week. This exercise is a win-win on several levels:

  • It helps me develop the right habit of reviewing deals that took place last week.
  • I am going to write this blog every Monday so that the news is fresh and relevant.
  • It offers perspective to the founders (that read my blog) on the themes that I find interesting; therefore, I expect (fingers crossed) to create a new deal sourcing mechanism!
  • I’ll attempt to connect the start-ups I discover here, with the start-ups in my portfolio; it opens up the possibility that both startups could work together for mutual benefit

Several platforms provide weekly reports on funding news, but I am going to concentrate on YourStory, Inc42*, and Tracxn. These three sources offer the best-researched information on Indian start-ups; therefore, if I utilize all three, there are remote chances of missing out on exciting funding news.

  1. Svami – $1 million

I learned about Svami from my friend and co-investor, Nikunj Shah. A month back, he was raving out about Svami when we met at our offices. At that time I regretted it was too late for AVF to get into the company as the deal was beyond the fund’s investment mandate. Even then, I continue to track the venture, that just raised a $1m round led by Rukam Capital Trust.
Svami team’s branding strategy and their passion for their product is something that other D2C brands could emulate. They have opened up a blue ocean in the premium beverages space with their tonic waters. I recognize that I may have a bias on Svami as I see synergies in distributing their drinks through Daalchini’s smart temperature-controlled vending machines, or through VistaRooms’ to the luxury home rental’s customers.

  1. myHQ – $1.50 million

I am personally extremely bearish on the coworking/co-living space. My pessimism stems from the numerous co-working pitches that I have heard from the founder, real estate groups, and family offices. Each of them claims that they will achieve a pole position in the coworking space within the next 3-4 years with 1 million seats. Unfortunately, when I hear this promise so many times and from so many people that it is easy to see the space over-capacity and low realizations in the future for this space.
What concerns me the most is that none of these promising founding teams has kept tabs on the number of seats their competition is building. I suspect that in the next 12-18 months, there will be a slew of shutdowns consolidation and belt-tightening.

If I am this negative on the space, then it is a pertinent question as to why have I put this round led by India Quotient on this list?

What aroused my interest is the Work Cafes model on the myHQ site. While not precisely similar, it reminds me of the Anticafé model that I saw in several places in Paris. Their concept is simple. They charge their users by the hour that includes food and drinks effectively, making it a coworking café. I found the idea intriguing enough to attempt incubating the idea in-house but could not find the right people to get it going.
Therefore I chose myHQ because of the Work Café model because, in my opinion, it is an idea worth exploring!

  1. Perfios – $50 million

It is difficult to call a 12-year-old company a “start-up,” but I like Perfios’ tech stack that makes credit assessment, monitoring, aggregation, and fraud detection easier for banks and NBFCs.
As an early investor in Karza Technologies, I understand and appreciate the pain point addressed by Perfios, and it is the leader in its space. The new round led by BVP and Warburg, the company, shall be utilized to expand Perfios’ geographic reach and to make acquisitions. I believe that Perfios and Karza could provide a killer product for banks and NBFCs if they worked together as the former utilizes company data to make assessments and Karza uses proprietary databases for the same.

  1. WMall – 64 crores

I am intrigued by the influencer marketing and social commerce space, and WMall offers the best of both worlds. As an early investor in Coutloot, I have followed this space for the past few years, and it will be interesting to see who will dominate this space.
*I am an investor in Inc42 through Artha India Ventures