Founders, leave the Legal Jousting for later (rounds)

If a man gets known by the startup he keeps, then a founder should be known by their legal professionals.  Think about it, out of the vast sea of capable professionals available, the founder’s ability to separate the chaff from the wheat gets judged when they choose untested people to represent them in front of investors (or acquirers).

In a recent transaction, the partner of the law firm signed up our founder to protect them, but then the transaction was quickly hived off to an associate who was (at the time) working on their 2nd or 3rd term sheet. The “associate” relying on the legal knowledge taught in textbooks versus the knowledge gained from doing real transactions merrily redlined every single line of our term sheet. It was as though the associate was grading a college assignment.

The founder didn’t understand why there were so many redlines. They did not take the time to know whether the issues redlined were issues (for them) and forwarded the email to us. The entire episode made us reevaluate our assessment of the founder’s maturity.

Note to founders: When your legal help sends back term sheets with more than 10 red lines, you either have the wrong law firm or the wrong investor.

Founders erroneously expect their legal help to do three things that inherently have conflicts of interest:

  • Represent the startup
  • Represent you as a shareholder
  • Represent you as an employee, i.e., CEO/CTO/etc

With three different vantage points to look from, which one should the legal professional put as first, but most importantly – which one comes last?

Who an investor will want lock in their legal agreements can be explained by this diagram from a presentation:

In the early stages, your startup derives its value from your role as an employee. Your startup ties you in as an employee by providing you with a large chunk of equity as a shareholder. Therefore, the startup doing well is directly proportional to you doing well. If you (as an employee) do not perform, i.e., cannot execute on the business plan or leave the startup mid-way, then the large chunk of equity given to you must go back to the startup. Regardless of your involvement in your startup, the startup must continue to operate. It could mean that they must find someone who will execute the plan on which the startup got valued or end up liquidating.

Therefore, the valuing shareholders, i.e., the investors, will include caveats like vesting, lock-in, ROFR, etc., to protect the startup’s interest and its shareholders i.e. you. You must remember the investors are the ones that valued the startup based on your promise to execute the business plan. Any changes that negatively affect the startup’s value will get reprimanded seriously. It may not be in your best interest as an employee, but it is in the best interest of the startup and yours as a shareholder.

As the startup matures, the reliance on you will reduce, and the startup will justify its valuation with revenues, intellectual property, profits, etc. Most founders will move out of the daily affairs of the startup as running day to day operations get too structured for their innovative mindset. However, the startup will continue to flourish without them.

Now imagine that the startup is going an IPO. Would you (as the shareholder) and your startup have the same lawyer representing both of you? No, you would not. It would be unsound legal advice.

Therefore, just like hiring investment bankers to raise early rounds of capital is useless – so is hiring a law firm to negotiate early rounds. The law firm’s partner cannot justify spending their high per-hour legal charges on the nominal fees you can afford; therefore, your transaction will get managed by an associate looking at making a mark.

However, should your startup be the guinea pig for someone else’s career ambitions?

A better strategy is to self-educate on term sheets and shareholders’ agreements. Brad Feld’s Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist is a good start, although it specifically caters to the western ecosystems. You could sign up for TiE Mumbai’s workshops on Termsheets and Founder’s Agreements, which are helpful for you too. Here is a video from one of their sessions on valuation:

Therefore, instead of pushing off the problem onto your lawyer, who will push it off onto an associate who will eventually screw up your relationship with your investor. You, as a founder, get better served by knowing the monster you are dealing with and leaving the legal firms for rounds where the fees you payout are commensurate to the size of the round you are raising. Then you can demand that the partner personally looks at the documentation.  

No one gets a free lunch. No one.

My Funding Picks For Last Week (W38)

Every Monday, I sit with my team to review the funding activity of the previous week. From that list, I pick out three companies that I would have loved to invest in or find founders that are doing similar things. Click here to know about my rationale behind this weekly exercise.

Last week, the ecosystem bounced back with over 3 equity deals/day average, with 17 startups raising $673 million. September is an excellent month for startups as the amount of capital raised crossed $500 million in a week for just the second time year (last week was the first). As the global economies recover and the Indian economy continues to unlock – this is a trend that should continue.

This week 12 deals were in the early-stage rounds (compared to 5 last week), which made the cut for my weekly analysis. After sifting through the news (aggregated from Tracxn, Inc42, and YourStory), I pick these three as my favorite funding news from last week!

Name: Pitstop

Amount Raised: $1.2 million from Acko

What does Pitstop do?

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

Why do I like Pitstop?

While there are many platforms like GoMechanic, Carvolution, and Zippity that are in this space, the exciting thing about this deal is that Pitstop is the strategic investment by Acko. Acko is a challenger insurance company backed by Barings, DSP, Ascent, Amazon, Accel, and Saif. Their association with Pitstop will create a symbiotic relationship between the companies. Acko can provide leads to Pitstop for car servicing, etc. and Pitstop can provide insurance leads to Acko. I would not be surprised if Acko went on to acquire Pitstop in the next 3-5 years.

Name: Deepsync

Amount Raised: $300k from Anicut Angel Fund and angels.

What does Deepsync do?

Edited from Tracxn: Deepsync provides deep learning-based technology to clone and augment human voice. It allows users to clone their voices from previous audios and synchronize them with videos and other media.

Why do I like Deepsync?

Voice AI is not new. Several players exist in the space, but most of them utilize  Google or Amazon’s voice libraries to build their solutions. Deepsync is interesting in that they’re taking anyone’s voice and cloning it. For example, I could clone my voice and record this blog as a podcast but without speaking the whole thing out. If it works – this is neat technology.


Amount Raised: Undisclosed from Java Capital, Upsparks, FirstCheque, and LetsVenture

What does do?

Edited from Tracxn: offers a B2B website personalization solution. The solution enables marketers to convert existing traffic to leads and change any website elements using the visual editor without coding, irrespective of the platform.

Why do I like

Following the trend of my other picks, is also present in a space with existing competition. I like because it offers businesses the opportunity to learn a lot more about the way their users interact with their website with detailed heatmaps. Their customer can use A/B testing for different customers, customize the site for each visitor based on their preferences, and increase conversion rates.

My Funding Picks For Last Week (W29)

Every Monday, I sit with my team to review the funding activity of the previous week. From that list, I pick out three companies that I would have loved to invest in or find founders that are doing similar things. Click here to know about my rationale behind this weekly exercise.

It has been several weeks since our ecosystem breached the 2 deals/day average with 17 startups raising $106 million last week. The bear market rally in the global stock markets has increased investor’s liquidity positions, and many are looking for options outside of the listed spaces. Founders must start thinking about how to make deals while the running is hot!

Out of the 17 deals, 16 were in the early-stage rounds (compared to 10 last week), which made the cut for my weekly analysis. After sifting through the news (aggregated from Tracxn, Inc42, and YourStory), I pick these three as my favorite funding news from last week!


Name: GigIndia

Amount Raised: $975k from Incubate Fund India, Beyond Next Ventures, S. Ramadorai, Ravi Nigam, Sakshi Gudwani, Shantanu, Kiran, & Shashank Deshpande, and Dr. Pratap

What does GigIndia do?

Edited from Tracxn: GigIndia is an online student network and micro-jobs platform. Users can get paid by completing micro-jobs called gigs for companies like writing a blog, designing a logo, or completing a survey. Students can also search for internships, perform tasks, and get hired after evaluation. GigIndia also offers a platform for students to connect with mentors and learn about various career opportunities.

Why do I like GigIndia?

With several parts of our country going through fresh lockdowns, the days of WFO (Working From Office) are a dream that is far from materialization. Companies, big or small (Indian or global), are looking for ways to cut fixed costs and rationalize spending through a project or task-specific costs. This new paradigm is where a GigIndia type platform comes in. In contrast, one could argue that there are several competitors like Fiverr, TaskRabbit, etc. I like GigIndia’s problem-specific solutions for businesses, like marketing, operations, sales, recruiting, and others. They aid businesses in breaking down a complex task into smaller gigs and then help owners manage them.

An interesting approach that we might try out for ourselves and our startups!


Name: Decentro

Amount Raised: Undisclosed from Y Combinator, Plug and Play, Upsparks, and other notable angel investors from the Indian and APAC community.

What does Decentro do?

Edited from Tracxn: Decentro provides open banking API solutions to banks and financial institutions. It offers APIs for KYC & onboarding, AML & compliance, digital lending, online payments, and more. It enables banks to build products such as neo banks, lending platforms, finance management, and more.

Why do I like Decentro?

I am a fan of open banking APIs as I have previously liked YAP and an early investor in Karza. Therefore, Decentro is on this list as I believe that Indian banking is not only broken; it is holding Indian businesses back.

Must I explain more why I am interested in platforms that solve this broken experience? 🙃 


Name: Zomentum

Amount Raised: $4.1m from Accel and SAIF Partners

What does Zomentum do?

Edited from Tracxn: Zomentum provides client relationship and sales process management software. It allows users to design and process sales process, retain them, and improve client relationships. It enables users to manage personalized reminders, set metrics and track performance of the teams, and share leads with other teams. Other features include sales funnel management, catalog management, branding, and identity management.

Why do I like Zomentum?

At Artha, we use Pipedrive and Salesforce to manage our sales processes. It does an excellent job for us, except that we must pay a lot of third parties to automate our sales processes. These addons significantly increase our monthly bills, and we must monitor the addons for errors, especially if the APIs are updated.

While I haven’t had a chance to test drive Zomentum (yet), I like their fully integrated approach. If it reduces my monthly costs and my operational overhead – I’ll switch!

My Funding Picks For Last Week (W28)

Every Monday, I sit with my team to review the funding activity of the previous week. From that list, I pick out three companies that I would have loved to invest in or find founders that are doing similar things. Click here to know about my rationale behind this weekly exercise.


For the past several weeks, the ecosystem is plateauing at barely double-digit transactions per week with 10 startups raising $36 million (amounts raised for the last 4 weeks: $65m, $31m, $27m, $92m). Early-stage investors have clinched their purses due to the lack of cool-down in valuations despite a marked tempering in funding interest. How can founders fix that? Stay tuned for my post on the subject next week.

Out of the 10 deals, 8 were in the early-stage rounds (compared to 11 last week), which made the cut for my weekly analysis. After sifting through the news (aggregated from Tracxn, Inc42, and YourStory), I pick these three as my favorite funding news from last week!


Name: BRB Chips

Amount Raised: $1m from Secocha Ventures, Globvestor, First Cheque, Kashyap Deorah and Vijay Sivaram

What do BRB Chips do?

Edited from Tracxn: They are a brand of extruded snacks offering chips as a snack.

Why do I like BRB Chips?

There is a lot of branded packets food plays, and while there’s no defensibility to vacuum fried chips, the list of entrepreneurs that decided to start this venture is impressive. The co-founder’s credentials include ex-Bira co-founder, ex-Forbidden Foods co-founder, ex-Coca-Cola, and ex-Schlumberger. As this team raised a significant amount of startup capital, I believe they can build an alternative snacking brand that would fold into a larger FMCG player. The key will be meticulously managing working capital and judiciously investing venture capital.


Name: Bold Care

Amount Raised: Undisclosed from Rajesh Ranavat, Abhishek Shah, Kabir Kochhar, and Mohit Satyanand.

What does Bold Care do?

Edited from Tracxn: Provider of an online doctor consultation platform for sexual health

Why do I like Bold Care?

I met a prominent Silicon Valley angel investor last year who increased my interest in the men’s sexual healthcare space. It’s a significantly taboo subject in India, but on average, about 5% of men above the age of 40 have erectile dysfunction. Many quacks (read: hakims) and online platforms sell glorified multi-vitamin tablets in the name of cures. Whether a company like Bold Care can get the sexual health conversation started could be a differentiator. Combining a thoughtful content strategy with the right product mix would reap great rewards from India’s untapped market.


Name: Inspekt Labs

Amount Raised: Undisclosed from Rajesh Ranavat, Abhishek Shah, Kabir Kochhar, and Mohit Satyanand.

What does Inspekt Labs do?

Edited from Tracxn: Inspekt Labs provides AI-based solutions for a car damage assessment. It provides an AI/ machine learning API that automates the car assessment. It offers solutions like damage detection, text detection, claims assessment, and fraud detection.

Why do I like Inspekt Labs?

Due to the way their technology works, they can quickly identify errors and emissions with a (claimed) 98% accuracy rate. I see a big space for this technology in insurance, product QA, to name a few. As their algorithms improve with more data collection, there could be future applications in food packaging and warranty repairs. I am especially thrilled to find an Indian startup come up with Indian deeptech with commercial applications. Their growth will only be accelerated by companies looking for new solutions due to the restrictions enforced upon them in the post-pandemic world.


I have purposefully left out Piggyride’s ₹3.50 crores raise from Artha Venture Fund last week (round led by JAFCO). However, you can find out Why We Invested in Piggy Ride.

My Funding Picks For Last Week (W27)

Every Monday, I sit with my team to review the funding activity of the previous week. From that list, I pick out three companies that I would have loved to invest in or find founders that are doing similar things. Click here to know about my rationale behind this weekly exercise.


As we enter the final days of unlocking v1.0, VCs are starting to loosen their tightly guarded pockets. As an ecosystem, we are continually maintaining the 2 deals a day average, but this time 14 startups raised $65 million – double the amount of moolah raised last week!

Out of the 14 deals, 11 were in the early-stage rounds (compared to 11 last week), which made the cut for my weekly analysis. After sifting through the news (aggregated from Tracxn, Inc42, and YourStory), I pick these two as my favorite funding news from last week!


Name: Bombay Play

Amount Raised: $1.5m from Leo Capital and Ramakant Sharma

What does Bombay Play do?

Edited from Traxcn: Bombay Play is a game development company specializing in casino games. Some of the games developed by the company are Card Party, Pokemon Tower Battle, and Twenty Nine. Bombay Play develops games for Android and iOS platforms and generates revenue through advertisements and in-app purchases.

Why do I like Bombay Play?

The COVID lockdown provided the gaming sector with the right ingredients for massive user growth. Low-cost internet access at a reasonable speed and people stuck at home with little to no avenue for social interactions. Therefore simple games that do can work on inexpensive devices with minimal processing speeds can rule the roost. It isn’t a surprise that Ludo King has seen their MAUs break the 1.5m barrier!

I have learned a lot about the gaming sector through my investment in Rolocule Games and Kabaddi Adda. But I am confident that social distancing norms will cause permanent changes in user behavior, encouraging more virtual social behavior. If I am right, gaming companies like Bombay Play will be laughing their way to the bank!


Name: NextBillionAI

Amount Raised: $7m from Lightspeed Venture and Falcon Edge.


What does NextBillionAI do?

Edited from Traxcn: offers a wide range of AI-powered hyperlocal solutions, from business mapping to data management.

Why do I like NextBillionAI? is a company that aggregates data from the half a billion Indians who have gone digital over the last 5 years. As of December 2019, India has 450mn smartphone users, so there’s a lot of data getting collected. is trying to make sense of all that data providing actionable data for businesses.

Flashback Friday: Triggero

Triggero was an enterprise rewards and recognition services platform. Triggero worked on a SAAS model and was a provider of an enterprise social recognition platform designed to encourage the culture of appreciation. The company’s enterprise social recognition platform was easy to use. A powerful workflow engine that helped in employer could be custom moduled and self-managed, enabling leaders to drive culture and manage change in the organization.


Triggero was instrumental in creating a productive & motivated workforce, energize sales & distribution eco-system. Triggero had partnered with some of the prominent organizations across industries like Telecom, BPO, BFSI, White Goods & IT.


Founder: Paras Arora & Abhishek Singh Total funding raised USD 75,000/-
2020 status: Shutdown Number of rounds 1
Co-investors: Mumbai Angels


Why did you invest in Triggero?

Triggero was a powerful B2B SaaS platform in the HRMS space, looking at creating a rewards and recognition platform for in-house employees. One must remember that Triggero predated the entry of  Yammer, Slack, or Microsoft Teams in India, platforms that most of us have made an integral part of our work lives today.

Triggero also provided managers the ability to reward employees by giving them points that could get redeemed at the Triggero store for gifts. It was a unique offering.


What were the risks involved with the investment in Triggero?

I know now (but I did not know when I made this investment) that rewards & recognitions platforms make the best sense for companies that house large teams managed by a well-established HR department. Therefore selling to medium to larger-sized companies carried its own set of risks like:

  1. Long-tail sales cycles
  2. Larger budgets to hire experienced B2B sales reps
  3. They are competing against legacy systems and high switchover costs.

In 2012 employee rewards and recognition were unknown. Even employees associated HR with Holidays and Rangoli,’ and business owners looked at HR as a cost center. Therefore, I realize (now) that Triggero was probably too early for the Indian market. The company should have raised a much larger round of funding to buy itself time, which unfortunately at the time (and possibly even today) was not available.


What was the primary reason behind dead pooling Triggero’s investment?

There were a couple of factors that affected this decision. Triggero lost a major client shortly after we put in the first tranche of investment. The company started to hemorrhage money due to the loss of revenues. This investment also enlightened me on the considerable time lag between billed revenues and banked revenues in a post-paid B2B revenue model.

The founders’ plans to scale fast took a severe hit, and they could not afford the capacity that they had acquired to build their platform. Considering all the issues that the company faced, it did not make sense to continue investing in the company, and I wrote off the investment.


What mistakes did Triggero make, and what was your learning as an investor?

Triggero’s biggest mistake was that they tried achieving B2C growth as a B2B company. Therefore, instead of waiting for purchase orders to build development and delivery capacity, they made capacity and then tried chasing sales – a dangerously desperate situation that any B2B founder should not find themselves in. Therefore, a lot of the expenses got frontloaded before revenues flowed in.

Secondly, I firmly believe that they didn’t raise enough capital. Triggero’s angel round did not give them enough runway to experiment, and (with the benefits afforded to me by hindsight), the founders and the angels should have decided against investing the money. Instead, we could have waited until Triggero could raise a more substantial round to give Triggero the runway to become a significant player.

Third I learned the importance of tranche-based investing. It is an essential method of risk mitigation for early-stage investors in cases where the venture doesn’t go down the desired path.


Would you invest in a similar startup today?

I believe that the world has moved on from R&R platforms, and Triggero would have a tough time finding a niche in the corporate domains where Slack, Teams, WhatsApp, and Yammer dominate communications.

It had the potential to be an Indian version of Yammer (that Yammer/Microsoft could eventually acquire), but alas, we did not get the required scale and adoption.