What’s common between the worlds largest brewer, the 5th largest food & beverage company, and the 7th largest food chain in the world? They’re all owned by 3 guys – the co-founders of the PE firm 3G Capital.Continue reading
Cash incentives are a great way to reward your team for good work, but it doesn’t leave an impact. Here are some other rewards I gave my team at Artha.Continue reading
A question that haunts founders and funders alike – profitability over growth, or vice-a-versa? Here’s my take on what most people would answer, “it depends.”Continue reading
I am continuing on the same thread upon which I wrote last week, i.e., Finding Silver Linings in this lockdown.
Yesterday we completed 40 days of working from home. Amongst several pivotal moments that define the turning points for Artha, sparking off a blogging revolution is definitely the most satisfying one.
For a very long time, I tried to convince my team to start blogging. I tried several approaches, showed them how my own blogs helped me express myself creatively and develop a robust network & following. However, the fear of getting criticized publicly made the team members shy away from expressing themselves – whether I offered them a carrot or the stick in return.
I could have got their blogs ghostwritten, but I wanted our blog to be genuine expressions that resonate. After several frustrating failed attempts, I threw in the towel. I stopped pushing the team to write because even when they wrote blogs due to the fear of disappointing me, they were half baked as the attempt to writing them was.
Then the lockdown took place. With commute times dropping to a few seconds from the hours endured earlier, a few members decided to utilize the extra time to creatively express themselves.
As the editor to our blog pages on Medium, any team member that completed a blog for publishing would assign a task to me. I had to review, make final edits, and approve their blog to publish from our Medium publications. Most of the time, it would be weeks, and even months before I would see assigned tasks in my editorial bucket. But things changed quickly.
Within the first week of working from home, I got notifications that I was assigned 2 blogs for publishing! This is interesting, I thought.
The first blog was published on Artha Venture Fund’s blog page. Farhan wrote a playbook for anyone that wants a VC job, i.e., Breaking into VC. He frankly shared his personal journey of hounding my inboxes until he got me into meeting him face to face. He impressed me enough with his enthusiasm to secure an internship at Artha. With a foot in the door, Farhan converted the opportunity into a full-time role. Farhan offered his playbook as a model for others to emulate. His post received a fantastic response with 300+ views in 3 days on our otherwise dormant blog page.
Unbeknownst to me, Deepanshu wrote and published a fantastic blog while sitting on his la-z-boy chair at his home in Delhi. Deepanshu’s take on the new work paradigm aptly called Corona: Ghar se Kaam KaroNa, We did it, did you? got published at the appropriate time and it lit up the Artha India Ventures blog page on the same day that the AVF blog saw a massive spike in its activity.
Farhan & Deepanshu’s unrelated but perfectly timed efforts sparked off a content creation race in Artha. They (thankfully) weren’t shy about the attention that their blogging debuts brought to their LinkedIn inboxes. It made others jealous and smashed the glass ceiling that kept the team from expressing themselves. All of a sudden, every person at Artha was lining up to write whether it was partners, principals, legal associates, junior analysts, even our interns!
There was so much content to review & publish that our internal PR team had to put everyone on a publishing calendar. Every team member got assigned 1 day a week to post their efforts on the company blog. I blocked out an hour a day to review the final drafts before publishing. But when I look at the list of blogs waiting for my review, even a couple of hours a day will not do justice.
In the end, I learned a valuable lesson. The thrill of competition drives a person harder than the fear of retribution. I tried igniting a creative explosion within Artha with the right intentions but the wrong strategy. Eventually, the age-old tactic of replacing my stick with a pair of binocular to keep up with the joneses got me to my long-held goal of creating a thriving blogging culture at Artha. That is a silver lining for me to cherish!
Here is the list of the 25 blogs we have published on our blog pages in the last 33 days
The history of sports and wars is replete with moments of inspiration. The odds are stacked up against the underdog. Out of nowhere, there is a moment of inspiration. The narrative gets altered, the game has a new direction, and an inevitable defeat morphs into an unlikely victory. I’ve previously spoken about the similarities between entrepreneurs and athletes; therefore, it is a given that such pivotal stories show-up in the lives of entrepreneurs and venture capitalists too! It happened during this month.
We shut our office on 18th March, i.e., 32 days ago. I was jittery about the future. The world was teetering at the brink of collapse, our fundraising plans got thrown off its rails, and by the time we shut down the office, moved everyone to work-from-home it wasn’t clear if our portfolio (or we) would emerge floating or underwater (pun intended).
The weekend before the shutdown, we had had a riveting offsite that was chill. But as we rapidly shut down, there was an air of discomfort, even a distrust that whether our goodbyes were temporary or final. I could see that my people were in different stages of depression as they slowly trudged out of Artha’s Coruscant. The moroseness over the collapse of the world started making inroads inside the strongly guarded walls of my work universe.
It was serendipity that while my work world started to spin out of control, I was reading a Dale Carnegie’s, How to Stop Worrying and Start Living. In chapter 6, How to crowd worry out of your mind, Dale talks about the importance of replacing worry with activity. He says:
We cannot be prepped up and enthusiastic about doing something exciting and feel dragged down by worry at the same time. One kind of emotion drives out the other.
In my context, the critical part was to discourage my people from dwelling in the bleak future and get them to start acting. I put up a schedule full of activity for the team (and myself), we took on new opportunities, and we began to collaborate multiple times a day on projects. The team initiated new projects – some relevant and some that I knew was irrelevant – but the vital objective was to keep them gainfully productive – so I approved them.
Even with our portfolio founders, we initiated plans to refocus their attention on the most relevant job at hand, i.e., survive! We worked with them to cut growth spending, shrink expenses, prepare new budgets, and focus no-cost growth opportunities. The efforts started to pay off results slowly at first but much quicker as the plans took hold.
Many founders discovered opportunities that were otherwise looked over, and a number of them started new business lines. The founders loved the proactive approach. However, there were a couple of founders that got shocked into inaction, i.e., they did not want to alter their course even if it meant taking their titanic into the glacier at full speed.
Thankfully our early warnings gave them crucial extra minutes to avoid hitting their iceberg at 22 knots, and they were saved from sinking to the bottom. It was a much-required reminder for all of us on the value of proper prior planning.
Needless to say, the first two weeks of working from home was akin to the chaos that precedes a war. I was up at 5 am (on most of the days) and slept at no earlier than midnight. But my mind was switched on 24/7, as keeping the spirits up for everyone around me became a full-time obsession.
I operated from a makeshift home office (that was previously a storeroom), it had a single window and an air conditioner that threw out hot air for the first week. I itched to get out of the house, to the airport and fly to an unknown destination. I needed a break, but it wasn’t coming – at least any time soon.
In those initial weeks, I compared my situation to Bruce Wayne’s in The Dark Knight Rises. Bruce is thrown to the bottom of the pit with little energy to climb to the top. But Bruce finds the inner strength to conquer the well, and Bane (eventually). Comparing it to my situation, getting my team and portfolio founders moving was akin to climbing up the pit. However, ensuring that my founders and my team thrive in the face of an inevitable washout would be like conquering Bane.
Part one is done, and I am 100% confident that we are on course to overcoming our Bane.
I’ll get back to you on that.
I wanted to write a follow-on to my article on the interview of Confirmtkt founders, but the events of Feb 14th were too much to stay quiet about and I couldn’t stop myself from writing an open letter to the PM. Post that, my travel plans stole my focus for a couple of days, so here is the follow-on article as promised.
In their interview, Dinesh and Sripad recount how difficult it was to fire underperformers or team members that did not suit the role they were in. Their personal equations interfered with professional judgement and the venture faced the consequences. I believe that this is a key lesson in every founder’s journey to become a leader i.e. a moment where he/she has to reflect and ask themselves ‘can I be a good leader & a good friend to the same person?’
Discovering the answer to this question could be one of the most difficult experiences a leader might endure.
I have seen several leaders (read: founders) get too close to their followers (read: team members) and lose all objectivity (due to the close nature of the relationship). In all the examples, (including my own experiences), this is a disservice to their role as leader, the team and most importantly, the venture. In many cases it has led to the termination or a permanent alteration in a friendship.
This reminds me of a scene from the superhit movie Dangal wherein Aamir Khan plays the role of a strict wrestling coach (Mahavir Singh Phogat) to his daughters. In the scene, he is massaging his tired and sleeping daughters’ feet. His wife exhorts him that he is too tough on their daughters when they are awake but massages their worn-out feet while they’re asleep. He explains that he can either be a good father to his daughters or a good guru (read: coach), not both.
Similarly, I believe that a person can either be a good leader or a good friend, not both. A leader has to utilize many tools to get the best out of his/her people, but those tools could fail at the altar of friendship. Therefore, before hiring a friend I always make it clear that our friendship would be over until the time we become partners because until then I would be doing a grave disservice to my friend.
For today’s post, I had decided to write a book review. But while browsing through espncricinfo.com, I came across a brilliant piece of journalism on Virat Kohli, undoubtedly the most famous man in India. The journalist, Wright Thompson followed Kohli for a day and wrote about how Kohli dealt with his superstardom daily. He brought to light the two different sides of Kohli; the outside persona which is what the public sees and the inner, softer, a more personal side that he keeps concealed. The trials and tribulations of this Indian superstar are a must-read for anyone who dreams of becoming one.
Kohli has been an enigma for me. Although I do not like his batting (since it lacks the poetry I heard in Tendulkar’s stroke play), I love the way he responds to a challenge. Kohli always aims to dominate a challenge and invariably prevails because of his limitless perseverance that always lasts longer than that of the challenger. He never lets the pressure of a situation show on his face or in his body language, consequently helping him find the clarity to make tough decisions.
So, while I might not like watching Virat Kohli bat, I do love to watch him play. And after reading about him in this story, I seek to emulate him, just a little.
During my 3-week, 3 continent tour I fell out of the habit of writing my daily blog posts. Even after I returned I kept putting off restarting until “tomorrow”. Then last night on the drive home, I heard Shashi Tharoor’s interview on the radio, announcing the launch of his latest book. During the interview, the RJ asked what advice he would give to budding writers that are just starting out their careers. His answer encouraged me to climb out of the procrastination vortex and start writing again. His exact words were, “the only advice I would give to a budding writer is to keep writing”.
So, thank you, Mr Tharoor… and here we go again!
Today Artha will be publicly testing out service for our 57 (soon to be 61) startups to connect with
- Larger companies
- Other startups in our portfolio
- Legal, compliance and service professionals
Over the past 3-4 months, we have been testing this out internally with excellent results for the startups and companies that we connected them to. Now I am making a public announcement to invite companies of all sizes to look through our portfolio and see if they want to work with one or more of our companies. If you are interested, reach out to us on firstname.lastname@example.org specifying which company you are interested in working with, and we will be happy to facilitate the connection.
This initiative will be led Artha’s very own networking ninja aka Sanjay Gandhi. He will be backed by the support of the Artha India Ventures & Artha Venture Fund investment teams.
After what seems like a lifetime, I am happy to announce that Artha Venture Fund-I (AVF-I) is officially an Alternative Investment Fund (AIF) after SEBI’s grant of the approval. Our team is ecstatic about receiving this news and we are currently working on the final leg of processes, i.e. signing up Limited Partners (LPs) that have made soft commitments to the fund.
AVF-I will invest in pre to early revenue startups, preferably where we are the first investor (in India we would be called the seed investor). We will invest between Rs. 1-1.50 crores in each early-stage investment and participate in the follow-on rounds with larger cheques i.e. 3-4 crores in pre-Series A and 6-9 crores in the Series A round. Therefore, once we invest in a company, they can (provided they perform) expect between Rs. 10-14.50 crores over the course of 3 rounds, from us (an institutional investor). This is a significant USP compared to the other seed funds because we have earmarked a portion of the fund corpus to invest in follow-on rounds.
We made this adjustment because we noticed that when the seed fund doesn’t invest in the Series A round, often, these companies are unable to raise ‘the’ round of capital that separates the men from the boys. So, we did some research on developed startup ecosystems and found that the top-performing seed funds wrote significant, if not larger, follow-on cheques for the Series A round. To further strengthen our hypothesis, we analyzed the MCA records of the Indian unicorns (startups with a valuation of $250 million or more) and also conducted research on the Artha India Ventures’ (AIV) portfolio startups that have raised their Series B rounds. This research concluded that it is possible for Series A investors to make as good a return (on an IRR basis) as the seed & pre-series A investors. This in turn also led to an adjustment in AIV’s investment strategy over the past couple of years (we started writing Series A cheques in our portfolio companies) and the results have been very encouraging, to say the least.
Even in my informal conversations with partners, associates & analysts of later stage investors I have noticed that there is a common lack of confidence in startups that come from seed investors who cannot or aren’t willing to write the cheque (that is significant enough) for the Series A round. The more investors I spoke to the stronger my conviction was that AVF-I had to make this an important USP i.e. getting the confidence of later stage investors in AVF-I’s recommendations for Series A investments, thereby catalyzing the decision-making process for new investors. Most later stage funds that knew our strategy started actively engaging with us on deals in the pipeline and even sending us deals that were too early for them to invest in. I see this as their endorsement of our strategy and look forward to working with the many family offices and later stage funds that are looking for high-quality deal flow.
Besides our investment strategy, we also bring our founders a large network that spans across the globe. Many of these connections are part of to the business relationships our sponsors have (more on them below) as well as the ecosystem created by AIV’s investment in 56 startups (10 of them domiciled outside India). The close connection we maintain with our network will give our investees a leg up in whatever help/access they require along the way.
I want to thank the people that played a part in taking this idea from a mere concept to a final business model:
- Yash Kela who came up with the original idea of starting AVF. He is more like a brother than a partner and it is his vision has become my mission. He introduced me to a slew of fund managers, venture partners and single-handedly recruited the entire Advisory board for AVF-I.
- Madhusudan (Kela) uncle for devising our unique fund strategy that ensures that the fund team will only make money if we deliver outsized earnings for the fund and of course the investors. I also want to thank him for his personal mentorship every step of the way and the endless support from his family office. Yash and I promise to take AVF to a level that will make all his efforts worth it and make him proud.
- My chacha, Ramesh Damani who immediately endorsed his commitment to the fund idea and got me all the help I needed to remove myself from the daily responsibilities at the companies under the Artha Group of Companies. It is well understood what an early endorsement can do for an entrepreneur’s confidence, and I have him to thank for that initial boost of confidence.
- My brother, Animesh, and sister Apurva who joined Artha when I needed them the most and took over Artha Energy and Artha India Ventures, respectively.
- Sanjay Gandhi, the legal head of Artha Group. If it wasn’t for his persistent follow-ups with our advisors and the SEBI officers, this approval could have taken twice as long. (He must be the most relieved as he won’t have to avoid me when I ask why the approval is taking this long!)
- Vinod Keni and the entire AVF team – Dhiral, Nikunj, and Karishma for continuing to believe as things moved slowly and working on building out the entire referral ecosystem which will power our deal flow going forward.
- Sandesha for managing what can only be described as the most gruelling job that anyone could ever have i.e. managing my travel & meeting schedule and doing it with an alien-like accuracy.
- Last, but not the least my family for being understanding & supporting me throughout the emotional turmoil that a founder of an early stage venture fund goes through.
Going forward, we are in the process of issuing term sheets for 2 very exciting startups and have also made a warehoused investment for a third (will announce it shortly). We expect to achieve our first close in the next 3 months.
Therefore, if you are a startup looking for a well-equipped and experienced investor, reach out to us on email@example.com.
If you are interested in investing in the fund you can reach out to us on firstname.lastname@example.org
Siri tells me that it took 1,347 days from my first blog post, Dropping Out Of The Rat Race… to my 100th blog post. Thereby, on an average taking 13.5 days to write each blog post. If I remove the 31 blog posts written in 66 days of this year, the average will shoot up to 18.5 days per post, therefore making it evident that things are already looking up for my blog.
In the journey to a 100 blog posts, I have had many interesting & challenging moments. There was a post defending an investee company against a much larger competitor that made it to the Economic Times (without my knowledge). The reaction to this was a screwball approach from their legal advisor who tried to pose as though they were trying to make us their client. That whole experience that was blown out of proportion led to a writer’s block, that made me stop writing for almost 2 months. There have also been times where I wasn’t confidant if what I was writing was meaningful enough for people to read. While reading the Bhagavad Gita over the course of the last 2 years however, I have come to the realization that it isn’t worth stressing over whether people like what I write or not. All I am responsible for, is writing and expressing my thoughts and the way it is perceived isn’t under my control. That lesson (albeit difficult) is something I am starting to imbibe as a motto for all the things that I do in life and hopefully inspire the people around me to pick it up too.
Which is why I think this poem from Edmund Vance Cooke is the best way to express what I have learnt from the journey to 100th blog post, a target that I did not believe I could achieve when I started (my goal was 50).
Now my goal is to just write every week day (my goal is 260 blogs for the year) with no particular number of blogs in mind. The only goal is to write and to keep on writing, come what may cause in the end it is the journey that counts.
How Did you Die
by Edmund Vance Cooke
Did you tackle that trouble that came your way
With a resolute heart and cheerful?
Or hide your face from the light of day
With a craven soul and fearful?
Oh, a trouble’s a ton, or a trouble’s an ounce,
Or a trouble is what you make it,
And it isn’t the fact that you’re hurt that counts,
But only how did you take it? You are beaten to earth?
Well, well, what’s that!
Come up with a smiling face.
It’s nothing against you to fall down flat,
But to lie there–that’s disgrace.
The harder you’re thrown, why the higher you bounce
Be proud of your blackened eye!
It isn’t the fact that you’re licked that counts;
It’s how did you fight–and why?
And though you be done to the death, what then?
If you battled the best you could,
If you played your part in the world of men,
Why, the Critic will call it good.
Death comes with a crawl, or comes with a pounce,
And whether he’s slow or spry,
It isn’t the fact that you’re dead that counts,
But only how did you die?