January 9, 2025 • 44 mins
🔮 What does 2025 hold for Indian startups, venture capital, and innovation?
In this special episode, Partners at Prime dive deep into the predictions and trends that will shape the world of Indian startups, venture capital, and sectors in 2025.
Timestamps:
00:00 - Introduction: 2025 Startup & VC Predictions
01:15 - Prime’s New Fund Launch & Global LP Interest
03:00 - Focus on Early-Stage Investments: Fewer Bets, Deeper Support
05:30 - The Role of AI in the 2025 Startup Landscape
08:00 - IPOs in 2025: When Should Founders Start Thinking About Going Public?
10:45 - Growth vs. Profitability in 2025: What’s the Right Balance?
13:00 - Unit Economics: Key Metrics for 2025
15:30 - Emerging Sectors in 2025
18:00 - Why Founders Must Master Storytelling
21:00 - The Need for Better Dashboards & Actionable Metrics
23:30 - Overcoming the Growth-Stage Capital Challenge
26:00 - The Importance of Communication Between Founders & Investors
28:00 - The Role of Founders in Managing Burn and Growth
30:00 - Wrapping Up: The India Story in 2025 and the Future of Startups
🔥 What You’ll Discover:
- The Growth vs. Profitability Dilemma: How startups should balance both for long-term success in 2025.
- The India Story in 2025: Why global investors are bullish on India, and how new sectors like manufacturing are opening up investment opportunities.
As India’s startup ecosystem matures, this episode gives entrepreneurs the tools to navigate and thrive, from fundraising to scaling with discipline and focus.
🎧 Takeaways:
- The how of Prime Venture Partners’ strategy of concentrated investments and hands-on support.
- The role of storytelling in entrepreneurship and why it matters for attracting talent, partners, and investors.
- The evolving VC landscape, particularly for Series A and beyond, and how it impacts your startup’s future.
🔔 Subscribe for more in-depth insights on the future of Indian startups, venture capital, and expert predictions
LinkedIn: https://www.linkedin.com/company/primevp/
Twitter: https://twitter.com/Primevp_in
👇 Join the conversation – What are your thoughts on the startup trends for 2025? Share your predictions and experiences in the comments below!
#2025Predictions #IndianStartups #VentureCapital #AI #FinTech #PrimeVenturePartners #Innovation #Entrepreneurship #InvestmentTrends #TechEcosystem #GrowthVsProfitability #UnitEconomics #IPO #IndiaInvestment
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
We actually can deploy anywhere up to $10-12
million per company right.
Speaker 2 (00:08):
I think this is going to be the year of more IPOs
from Prime and Prime FamilyLaunching our new fund.
Speaker 1 (00:15):
Now we've got LPs from the Middle East.
We've got new LPs from Europe.
Speaker 3 (00:19):
Taking fewer bets but going deep in those bets.
Speaker 2 (00:23):
What should the VC stop doing in 2025?
Speaker 1 (00:26):
Everybody, unfortunately, has watched Shark
Tank and thinks that that's howthey need to narrate their
story.
Speaker 2 (00:31):
Most founders do not pay attention to dashboards, so
what is the right time to thinkabout an IPO.
Fundraising requires anenormous amount of storytelling.
Speaker 1 (00:39):
I'm going to disagree a little bit here why I can say
that as a South Indian.
Speaker 2 (00:49):
Hi everyone, happy New Year.
Welcome to Prime VenturePartners' first podcast for 2025
.
I'm Brij and I'm joined with mypartners in crime and in prime,
sanjay, tripathi and Amit.
So today we are going to talkabout what's in store for 2025,
especially for Prime, for theecosystem and generally for the
(01:10):
tech startups.
So we'll get started no holdbarred, candid conversation, no
scripts, except for the onesthat I'm carrying, so let's get
started.
So I'll start with you, sanjay,first, and especially from the
prime venture partnersperspective, what has 2025 in
store for us?
Speaker 1 (01:29):
2025.
What, what, what we have instore?
Uh well, very excited to to saythat we'll be uh uh launching
our new fund and uh fund, whichwill be fund five for us, and
it'd be similar to the tocurrent fund four, you know, in
the 120 million dollar range,and we continue to be focused on
(01:51):
early stage companies, backing,you know, four to five new
companies per year, as they'vebeen doing pretty much for the
last 14 years that we have beenin business here and you, you
know, the fund itself.
I think what has been gratifyinghas been strong support from
several of our existing LPs, butthere's also been a drive to be
(02:14):
much more institutional andwe're going to have several new
high quality institutional LPsfrom around the world joining us
in this journey as well, aswe've seen a lot of interest in
India as a whole and met somevery high quality, limited
partners from really allgeographies.
It used to be much more ofNorth America and perhaps a bit
(02:36):
of Southeast Asia for us, butnow we've got LPs from the
Middle East, we've got new LPsfrom Europe and to join us as
well.
Speaker 2 (02:46):
Shripati, anything from your side about Prime's
approach that is likely toremain the same or change?
How are you personally lookingat Prime Venture Partners in the
year 2025?
Speaker 3 (02:56):
So we will, in many ways, just continue to do what
we strongly believe is our wayof investing, which is taking
fewer bets but going deep inthose bets.
So we are fairly unusual amongearly stage investors in that we
take concentrated bets, whichis four to five deals in the
(03:20):
year, but we stay with themthrough the journey, with the
companies you know andcontinuing to participate in
investment rounds and thefollow-on rounds as well.
So that will remain the same.
So we'll be patient investors.
I feel that we'll be spending alot of time with our existing
portfolio companies in terms ofhaving them both incorporate and
(03:44):
navigate the changes that AIand the opportunities that it
brings.
I feel that the growth stagecapital for all companies will
continue to be a challenge forwhich they need to overcome,
because, while there has been avery large expansion in the
early stage capital which isavailable in India, there are a
(04:04):
number of new micro VC fundswhich have come up in early
stage and even angel checks noware fairly large, which is all
positive and indication of ourmaturing ecosystem but still the
bar for raising growth capitalwill continue to be fairly high.
So, looking for opportunitieswhere the entrepreneurs
(04:25):
understand that bit and alsomaking sure that our portfolio
understands that there'llprobably be an impact.
Speaker 2 (04:33):
Amit, over to you, I think, beyond Prime's
perspective, I'd also like youto touch upon broad spaces,
themes that you are personallymost excited about in the year.
Sure, so on the Prime front, Iwould say, firm, like we've said
, is over a decade kind of oldnow, so I think a lot of
companies are maturing at agrowth stage.
(04:53):
So I think this is going to bethe year of sort of more IPOs
from prime and prime family, butmore broadly, I would say,
cultivating an IPO mindsetacross everyone.
One of our founders, founder ofNavdhan, said it best at
Founders Day last year, whichwas that you know what is the
right time to think about an IPO?
His answer was the day youincorporate your company or
(05:16):
think about incorporating.
And to me that is actuallyreally, really profound, because
it is very different thanreporting some loosey-goosey
metrics to VCs and saying it'sokay, we'll do.
This is, you know, cumulativeaccounting.
This is that kind ofaccumulated ARR, this is, you
know, accrual, non-accrualcashflow.
The rigor to run yourself as apublicly traded company is a
(05:39):
very, very different kind ofrigor.
So, helping the broaderportfolio and certainly the
growth stage companies hopefullyyou know a couple of them will
go IPO next year or this year.
So we'll.
That is fun.
In terms of sectors, I would saylook, we do a bit of top-down
but we're also very bottoms-upinvestors, right.
So, in fact, last year you leda deal in the space of precision
(06:01):
fermentation, something thatnone of us knew about before.
You kind of brought that up tothere.
So I think there are going tobe interesting opportunities
bottoms up to build for India,for Bharat, for AI, for vertical
AI, etc.
And then the core sectors willremain right.
So fintech, ai plus SaaS, youknow, vertical AI those will
remain.
So those are the areas that B2Bthat we continue to remain
(06:25):
excited about.
Shrivati, I know you have beenspending some time on deep tech,
space tech, robotics, right.
You keep tinkering around allthose areas.
Anything around that that youare excited about in the year
2045?
Speaker 3 (06:41):
Definitely.
I feel that both of those whichyou touched upon, bridge, which
is robotics and space tech, arevery exciting areas.
So, when we think aboutrobotics, there is automation,
which is essentially taking aregular process and introducing
automation through robots inthere, and then there is
(07:02):
essentially, you know, theequivalent of self-driving cars,
which is autonomous systems.
So I feel that we are going tostart seeing automation
happening a lot more ubiquitousacross industries than
autonomous systems.
I feel autonomous systems arefairly hard and the last 10% or
15% of getting that safe andcorrect and so forth is going to
(07:26):
take a long time.
That's my belief.
So, on the but, however, whatwe traditionally usually think
about as robotics is a lot ofautomation and there's a lot of
value to be added there.
And this happens because nowthe AI models are becoming
smaller, they are becoming muchmore contained to run.
They can be run in their ownenvironment without having to be
(07:46):
dealing with a lot of compute.
This is the inference piece,because once the model has been
made, the inference can actuallybe much more fine-tuned and run
and vision is becoming muchmore powerful.
So they combine all of thesethings together.
I think automation is going tobe a very big team.
We have an industry which isco-led in manufacturing AI,
which is an example of that, butdoing things which is not
(08:10):
possible On the space tech side.
There are the force, thetaguins here, in terms of both
the support which we are gettingfrom the government and also
new areas which are opening upfor space tech.
Both in the defense side and inthe private sector side,
increased the total addressabletime very significantly and I
(08:33):
think the Indian startups thereare very well positioned because
we have both the talent and theecosystem which is conducive to
that.
Most countries do not haveecosystem necessarily to do that
, so I'm fairly excited aboutboth of those things I wanted to
just get back to one sort ofpoint about our fund right.
Speaker 1 (08:55):
We made a very conscious effort to keep our
fund size the same right, and Ithink this is sort of gone
against what you know we see,certainly with our peers, whom
we have deep respect for andgeneral mindset of, you know,
growing a fund.
And the reason we believe youknow this is the right thing to
do is, you know, actually a $100million fund is a very large
(09:20):
fund for early stage where wecan write some fairly
substantial checks too.
So the quantum of check we canwrite, whether it's anything
from 500K to $3.5 million at theseed stage or at the start of a
company, it's really quite asubstantial amount.
And with a concentratedportfolio, because we will
(09:42):
typically have 14 to 16 deals inthe fund, we actually can
deploy anywhere up to $10-12million per company right For
companies that are doing wellover the course of a couple of
rounds.
So I think what we wanted tomake sure is that we stay with
what has been true to ourknitting and what has resulted
(10:05):
in some extraordinary outcomesfor entrepreneurs, whether it
was happy or easy tap or quizzesor companies like my gate
wheels, you know, reco, where wecould have meaningful time to
spend with the founders, andthat you hear also now in.
All of us have entrepreneurialbackgrounds.
We feel that for founders andmore so we're seeing now
(10:29):
founders value the fact thatthey're not just getting a check
but they're getting qualitytime, and they're getting
quality time perhaps across thefour of us and our extended team
.
And for that to happen, youactually need to be in this
mindset of doing very few dealsdeals, but spending a lot of
quality time with the founders,and that triangulates back to
(10:49):
you know, the size of the fundand how we can deliver
extraordinary outcomes forentrepreneurs, our limited
partners or our investors, aswell as for ourselves, right?
So it was a very conscious andthoughtful decision to keep the
fund size the same and probablyinvolve a lot of discipline and
a lot of brainstorming, as youare aware.
(11:10):
So I just wanted to put thatout there as well for people to
understand the life of a VC andthe responsibilities of a VC,
and the ability to be patientwith entrepreneurs and build
large companies.
Speaker 2 (11:23):
Absolutely.
I think from similar storyplays out when you are building
a company, that's always easierto raise a larger and larger
amount of capital.
But eventually it's aboutbuilding a company that can
sustain over a period of timeand you raise an adequate amount
of capital to achieve that goal.
So it's very difficult at timesto hold on and stick to your
foundational principles and Iguess we all went through that
(11:45):
period last year, in spite ofall the attraction, interest
from outsiders.
Right, he said, we'll stay trueto the fund size that we have,
we'll stay true to what we havestarted out building at prime,
and I think that fund size givesus the best equipment to
achieve that goal you know avery well-known vc, uh told me
in my first week on this jobgood companies don't die of
(12:07):
starvation, but they can die ofindigestion.
Speaker 1 (12:09):
And I think the same philosophy is something we also
try to practice there.
You know, stick to yourknitting right.
But really excited again, asShri Patel said, about the
opportunities we have seen.
Speaker 2 (12:22):
So we'll go into spending some time around
founders playbook and the threeof you come with your own
operating and entrepreneurialexperience, but also decades of
now seeing multiple companiesfrom the boardrooms, and I want
to talk about specific do's anddon'ts, right, what founders
should do, should not do.
We'll start with you, amit.
(12:43):
Right For new founders enteringany space or raising capital,
what are the areas or themesthat you will recommend that
they prioritize?
If you were to be a new start,new founder in 2025, which areas
and themes will you recommendthey start out?
I think areas and themes areprobably best picked by them.
(13:04):
In fact, we joke about it often, right?
This whole notion of you know Amarket, b team, b market, a team
is eventually it's really theteam, right, because Sanjay
articulates this well thatthey'll pick the A market kind
of thing they should think aboutin that opportunity, right,
(13:28):
which is how can this be a verylarge opportunity?
Not every opportunity isnecessarily vc backable, right?
Uh, so the size of theopportunity is very, very
important.
The second thing is that,because you could build a
lifestyle business, a very good,attractive business, but it may
not be venture backable interms of both.
You know, velocity, speed anddirection and and the quantum of
the outcome that's possible.
The second is depending on thekind of business, people don't
(13:50):
spend enough time thinkingthrough distribution.
Typically, founders tend to befrom a product or engineering
kind of heritage, so you'realways keen to build something
and then we'll figure it out.
And not enough time ondistribution, right?
One of my learnings from thelast 10 years has been that,
look, it is as much aboutdistribution as it is about
product, if not more so.
(14:10):
Right, which is a little bit,you know, sad and paradoxical as
a product person.
But that is one.
Think through enough in termsof how are you going to get this
to customers?
Are the customers ready forthis?
Is this a real, meaningful topthree, top five problem?
Will they deploy it, et cetera.
And the last one is lookthrough good times and bad.
(14:31):
In the last three years havebeen a bit choppy right 22, 23,
24, now on to 25.
I think fundraising requires anenormous amount of storytelling
and being able to articulateboth the narrative and the
numbers right.
So I would say it's not just toget started, because you could
get started just on pedigree, oryou're from Magic Pen or Zomato
(14:51):
or XYZ or you know you're, butthen to say how is this going to
be a large company?
So I would say a few morethings beyond just the here is
the product prototype that I'mthinking of would be some things
that I would encourage peopleto think about.
So, start the company.
If you have to start for theright reasons.
Especially, founding is not acool job, right, it's absolutely
(15:11):
not.
And I think once you start iswhen you realize that, if you
start for the wrong reasons,that it is a slippery slope,
absolutely so Sripati amongstthe current founders, right,
there has always been every year, there is a dilemma between
(15:32):
growth and profitability, orboth, I think.
What do you think has 2025 instore?
So do you think it will be?
Speaker 3 (15:35):
about prioritizing growth, prioritizing
profitability.
How do you think about it?
So one rule of thumb which, uh,which I heard and I believe, is
that you need sustainablegrowth, which means that your
unit economics need to be solidwhen you're growing.
But also remember that at thisstage, you're a venture company.
One point of growth is worthlike three points of
(16:00):
profitability, and what I meanby that is that you often see
situations where founders arevery are plagues that why their
company is not getting fundedwhen they are profitable,
whereas some other competitorhas gotten funded and they have
not dropped.
And it's important to understandand this is fairly basic, but
it's worth repeating thatinvestors are looking for future
(16:22):
growth and future profitability, right, and they're looking at
the company state currently tosee whether this is a good proxy
for a future growth and futureprofitability.
And if you don't have good uniteconomics, the current revenue
is not a good proxy for futuregrowth and profitability, right.
That's because if uniteconomics are not good, it means
(16:45):
you have to raise a lot ofmoney to continue your growth
and your profitability is an unquestion mark, right, it's a
more risky investment.
However, the other end of thatspectrum is low growth and good
profitability.
In that case also, you are asan investor, you're in a dilemma
because now you have to betwhether okay, can this actually
(17:06):
grow, whether this market islarge enough or is the product
good enough to access the marketsize for this to grow.
So it is obviously a trade-offwhich founders have to make and
it is important to know that inthis case, if you're shown
validation that you're seeingsigns of good growth yet your
utility economics are fine, youmight still be losing money.
(17:28):
That's okay.
That's one which makes for anattractive company.
And the second is having theunderstanding that you're not
beholden to the market providingyou a certain amount of capital
at a certain amount of time, ina certain period of time to
actually grow your company.
What I mean by that is havingyour own destiny in your own
hands, which means that, ifneeded, you can actually become
(17:52):
a very low-burn company and thenactually be able to raise when
the capital markets open up.
We had talked about in theprevious podcast about edtech
and so forth.
You could be a very good edtechcompany, but if suppose the
environment is negativefortunately scenario it's turned
around, but if it continues tobe negative, you have to just
wait you might be a greatcompany.
So in those cases, having theability to just lower the burn
(18:18):
and sustain and become close toprofitability, these are all
like elements of building abusiness which I feel will
continue to be very important.
Speaker 2 (18:26):
And there is always this cyclicality in the startup
ecosystem.
Right, there are periods ofconsolidation.
Profit is the only thing thatmatters.
Then you will see suddenly aboom of growth, growth, growth
at all costs.
I think the last two, threeyears we have been sort of in a
good equilibrium where companiesare prioritizing profitability
(18:47):
and, as you mentioned,sustainable growth.
Do you see the risk that itmight change in the coming year
or in the coming two years, thatwe might be seeing another
bubble form?
Speaker 3 (18:56):
Well, I think this has always remained true.
Two 30 years ago.
It will be two 30 years fromnow.
These are the companies will bevalued in the long term on the
current value of future cashflows.
So you're not going to go wrongif you're going to believe that
now.
The reason why these thingschange is that that is the state
you want to get to, whereyou're actually generating
enough cash flows and growingand people are going to value
(19:18):
that way, which is how publicmarkets tend to look at
companies, right, so I feel thatfounders shouldn't get confused
about which way the cycle isgoing to go and which way the or
what the current zeitgeist isin the market.
The better way to think aboutit is that by solving a problem
and this is there a large enoughmarket opportunity for me and
(19:40):
the solution which I have thatactually provide providing that?
Yeah, absolutely, and if youcan convince yourself that, most
likely you're going to be ableto convince an investor, and
it's okay.
The investors are in thebusiness of risk capital.
They know how to take risks andsometimes they'd be wrong.
Most of the times they might bewrong, but they also understand
that at some point, if they'repatient, the tide is going to
(20:01):
turn B the idea is going to turnin their way.
Speaker 2 (20:05):
If I may add to that, I think now with a lot more
companies going public, even onthe Indian bourses there is an
external benchmark valuation,which was often not the case in
the private market.
Companies were staying privatefor very long.
I don't remember what Facebookwent IPO at almost 100 billion
market cap or some crazy largenumber.
(20:25):
You didn't really see what theactual value of the business was
.
Right, because it was only setby, you know, the private market
or some subset of the privatemarket.
So once there are things thatare public so now you can see
the stock valuation of adelivery or you can see the
stock valuation of attraction orwhatever then you say, ah,
these are the benchmarks thatare out there.
(20:49):
So I think a random bubble isless likely to happen, although
bubbles have been there forhundreds of years, not just
dozens of years.
So I think they'll come and gofrom time to time and I think
when founders are starting thecompany, they need to keep this
in mind that what their endstate valuation, size of the,
how this company will be valuedis now known Absolutely 10, 12
years ago.
Sanjay, you have been on manyboards, right?
What is one behavior and I willcall it, I'll say, your pet
(21:15):
peeve in terms of founderbehavior that they should
absolutely avoid.
Speaker 1 (21:19):
I always believe, you know, in over communication and
you know, as the saying goes,good news takes the staircase,
bad news takes the elevator andit's very obvious things are not
going to plan when foundersstop communicating or slow down
their communication.
I saw this even in some otherpodcast I was listening to the
(21:39):
other day saying, wow, I'm notthe only one who's observed this
.
Right.
So I think, you know, trust isa very important part of the
relationship, you know, betweenfounders and investors, and
investors are not their bosses,right?
I mean, if anything, it's theother way around.
Right, and it's important forfounders to establish that
(22:03):
relationship with their board orinvestors that they can bring
and discuss bad news with them.
Right, and I think the mostsuccessful founders are those
that you know will call you andsay I screwed up or something
has gone wrong here.
Right, and there's no shame init.
Right, it is what it is.
We are in this boat together.
(22:23):
Once you know your logo is onour wall there, we are in this
together.
There's no choice, there's noeasy way out, even if you're
bonded to part ways.
So the reality is you have tostart working together and
trusting each other, right, andto me, that's the one thing that
, as much as most founders sortof figure that out, over a
(22:44):
period of time, some of themwill struggle right, and they're
all human beings Nobody feelsgreat about ourselves when
things are not going well.
But that's also the opportunityto seek help, whether it is
with your board, whether it iswith other advisors, other
mentors, et cetera.
And that, to me, is a pet peeve, and I sense it very often,
(23:07):
because we typically will have aWhatsApp group with founders
and they'll be sending the mostarbitrary of things, which has
nothing to do necessarily withtheir success, because business
is going well.
But the moment business isgoing a little sideways, you'll
start seeing the frequency ofcommunication come down and I
think you know for most founders, that is the moment when they
(23:28):
should actually be much morecommunicative and transparent.
Speaker 2 (23:32):
Very well said you, being a founder in a startup,
that's gone through some bigdifficulties and I think it's
typical human tendency to go inyour silo, just go hunker down
and try and build and get out ofthat rat hole.
But I think the best thing onecan do is to actually share,
seek help and, finally, that'show relationships increase.
Trust right, that's howfounders and investors can work
(23:53):
together with each other insteadof being against each other.
Especially.
Speaker 1 (23:58):
Shibati says this from time to time right, being a
founder is very lonely and whenyou're in this and this is all
you're doing, this is your life.
Right, you may not want to tellyour family that things are
going poorly, because you don'twant others at home to get
stressed out Already.
They're seeing you working andoverworking and so on, and your
(24:18):
friends also generally want tobelieve that you're in control
of things, or, with your team,you have to say that you're in
control, so that actually leavesthe board where you can have
these confidential conversations.
That's a safe space forfounders and it does.
Perhaps you know a handful ofmentors and advisors, right?
So whoever you find is in yoursafe space, you know you should
certainly work with the,communicate with them, um, but
(24:40):
as investors, you know, I think,um, we are all you know.
The other advantage of workingwith investors is because we
have 50, 60 companies on ourportfolio and I can guarantee
you the other 59 are not havinga great time and you're the only
one struggling through.
What you're experiencing isprobably something that many of
the others are currently goingthrough or had gone through, and
(25:03):
maybe it could be fatal or,most likely, there is a solution
that, uh, you know, and you'rejust, you just be normal no,
absolutely.
Speaker 2 (25:11):
Especially when you're founding and building a
company, it's very, verydifficult sometimes to realize
that everyone else might be insame boat as other founder
friends of yours.
Right, and that's, I think, theboard and that place is a very
important place to be open andtransparent and just believe
that you will get out of it safeand sound.
On the other side, everycompany goes through it right.
(25:33):
It's not a surprise.
Speaker 1 (25:34):
I think the other thing and it is something that
probably I still am working onmyself is embracing
confrontation when things arenot going well.
You know, maybe you disagreewith your investor.
You know this whole.
People talk aboutpassive-aggressive right, where
you agree in the meeting butactually don't intend to follow
(25:54):
up on it.
That's probably the worst thingyou can do and that adds up
over a period of time, right?
So I think in general in Indiawe are brought up to not be very
aggressive, not confront.
Certainly in in India we arebrought up to not be very
aggressive, not confront.
Certainly in South India it'sprobably more true.
I can say that as a SouthIndian, but you know it's the
(26:15):
right thing to do sometimes,right, and it doesn't mean you
can disagree without beingdisagreeable, right?
And these are some techniquesand this sort of comes back from
its point of communication andstorytelling and all of these
things.
They all sort of come together.
Speaker 2 (26:29):
So I'll move to Shripati to you.
So 2024 was about the Indiastory.
Right, and as part of our ownfundraise, you would have
interacted with many of the LPs.
How are you thinking, or howare they thinking, about the
India story in 2025?
Speaker 3 (26:43):
I feel that clearly, if you look at emerging markets,
india is one of the mostattractive destinations for
investment, given just the sizeof the opportunity we have and
just the rest of the ecosystem.
We have a stable politicalsystem, we have a stable
(27:04):
economic environment and, ofcourse, we have the talent and
India has always been a placewhich has attracted venture
capital right.
So I feel that most of what weare hearing is that it is a lot
of the stars are aligned forIndia to actually grow very well
and continue the growthtrajectory and for startups to
(27:25):
play a very major role, not justin India, but outside India as
well.
I think there will be certainuncertainties and bumps in the
road.
I'm very much a thing that's apart for the post, as there's no
linear straight line which goesup.
There will always be ups anddowns, but I feel that we're
just very well positioned andsome of the areas which we
wouldn't have previously thoughtof as, uh, as interesting area
(27:48):
are now becoming, you know,venture invested.
So manufacturing is one of them,right, uh, because several
years ago we were probablyunclear how manufacturing is
going to uh, you know, reallytake root in india, what kind of
investments we're going to see,and now we're just seeing that
shift happen, uh, in a verysignificant way, and that means
that a whole bunch of downstreamactivities and supply chain and
(28:11):
enabling products and so on andso forth become opportunities
for us to invest in.
So there is a lot of excitementand we think that, as we saw,
our participation in our fund isan indication.
I think, that the Indianventure ecosystem is going to
see much more participation fromglobal investors.
Speaker 2 (28:34):
At least this year, we will see the continuation of
India's story or many years togo.
Speaker 3 (28:39):
To the extent that I can predict, yes.
Speaker 2 (28:40):
Yes, okay, Sanjay, I am not going to let you off the
hook on the Fintech side.
I remember that you.
What is it?
The Fintech side?
I remember that you.
So what is it in Fintech thatkeeps you still excited now and
20 years from now?
Speaker 1 (28:53):
I think, huge gap in access, huge impact and huge
profit pools to tap right andwith no winner-takes-all
requirements here.
Of course one would want to bea dominant player in whichever
company we're investing in, butyou really don't have to be the
(29:16):
number one or number two even tobuild a large company.
So, success, the price isreally worth winning.
I think that's my highest order.
But in anything we invest in,is the price is really worth
winning?
I think that's my highest orderbit.
In anything we invest in, isthe price worth winning?
Because I believe it's harderto build a small company than to
build a large company.
Right, because in the beginning, you know, it sounds really
(29:39):
sort of like how audacious isthis thought process.
But once you start showingsuccess, the world sort of
conspires to make you successful.
Right, and I think in fintechyou'll see several of these
opportunities.
Indians are, you know, juststill coming into the digital
age and getting you know intothe mainstream A lot of
(30:00):
businesses have the first pieceof formalization happened
through digital payments.
And then, on the consumer side,yes, that footprint, as well as
the formalization of the salarysystems and things like that,
has brought everybody into amechanism like MyGate,
digitizing all the Maycob DriverGardner.
(30:22):
All of a sudden now there issome digital data about them and
people are starting to pay themin their bank accounts.
Now you can see all thispredictability of income.
Maybe one could give them apayday advance loan or something
like that.
Right Education you know Amit'stalked about the third coming
of ed tech in the past andpeople are getting through more
and more formal and sort ofskill-based you know, learning
(30:46):
right.
That leads to income generation.
They start becoming much morecreditworthy Now.
You know lending to someonelike that again is very
effective.
And you look at the small stores, you know.
I know there is a lot of debateabout whether Kiranas will
survive and that might be truefor groceries and stuff.
(31:06):
But all the other, you knowbuilding construction, whether
you're an electrical store, aplumbing store.
You know selling car batteries,etc.
Working capital is the crucialrequirement.
It's really oxygen and they'veall been starved of it, not
because they're not creditworthy, because there was no data to
say that they were creditworthy.
So all these opportunitieswhich are deemed to be priority
sector are core to the GDPgrowth that we are projecting
(31:31):
here in India, and financialservices is going to be the
lubricant that's going to fosterthis, and startups will have a
huge role to play, so we'll gointo sorry, the last one.
That is also the boom incross-border right and we've
talked about LKM, which is thecompany in our portfolio.
That's the first one there andagain there in the cross-border
working capital results be ahuge requirement.
(31:54):
So I think this is a continuousopportunity here.
Speaker 2 (31:57):
No wonder you are excited about for the next 20
years.
So I'll go into the lastsection, which is the section
I'm most looking forward to.
So I'll ask one of you rapidquestions, and you need to reply
rapidly, but then you need toslowly explain why did you give
that answer?
So I'll start with you, sanjaythis one.
Speaker 1 (32:18):
I think you should start with going alphabetical
order when I'll go with Amit.
Speaker 2 (32:21):
So, amit, one thing founder should do immediately in
2025 pay attention tofinancials.
Pay attention to financials andwhy.
You know, stay alive, know whatyour cash situation is, know
what it will take to grow, etc.
Etc.
Keep the company going.
Keep the company going both ata growth mode and at a survival
(32:44):
mode.
That will remain true forever.
And Sripati, one thing thatthey should stop doing, the
founders.
Speaker 3 (32:51):
Well, I think we should answer that question by
saying actually, most foundersdo not pay attention to
dashboards.
Okay, so it is a very simplething, but creating good and
actionable dashboards takes alot of focus and effort.
It takes six months, in myopinion, if you're actually
focused on it, to actually getdashboards which are consistent.
(33:13):
We talk about pet peeves inboard meetings.
It is just seeing differentnumbers are different in every
meeting.
Yeah, so if you have XYZ asyour business metrics in your
one board meeting and seeing ABCin the next one, what happens
with XYZ as your businessmetrics in your one board
meeting?
Speaker 2 (33:25):
and seeing ABC in the next one.
What happened to the?
Speaker 3 (33:26):
XYZ right.
They are kind of likedisappeared and not seeing trend
lines.
So I feel that it'scontinuously underestimated.
I'll give you an example.
Right, start seeing all theseadjectives applied to revenue.
You have gross revenue,adjusted revenue net revenue.
Speaker 2 (33:42):
Accounting revenue non-accounting revenue multiple
variants of that.
Speaker 3 (33:46):
This is like what we have done to contribution
margins.
Right, we have gone in andcompletely messed it up.
Now.
Contribution margin used to besomething which is like whatever
comes after all your variablecosts are taken off, no, you
have CM1, cm2, cm2.5.
You have, like all these kindof things which which keep
coming up.
So just taking a step back,having a term in your matrix it
(34:11):
just says revenue actually,which any big four accounting
person it will get from eny orpwc will also agree with and
which you might actually one daygo public with and and be able
to defend, would, for example,be very helpful, right.
So these are the kind of thingswhich I'm being a little
facetious, but the reason isthat taking the time and the
(34:34):
discipline to put these thingstogether and then consistently
following that actually helpsthe founders.
Good metrics, as Amit has saidpreviously, actually inform
behavior, and then it also helpsgetting the board be educated
on the nature of the company.
So that would be probably onething which I would say they
(34:54):
should both stop doing andperhaps start doing.
Speaker 2 (34:57):
So on to the VCs.
Sanjay, what should the VCsstop doing in 2020?
Speaker 1 (35:03):
I was going to say they should start funding more
of our companies and follow upon this.
And look, I think there'sdefinitely a gap in India at
Series B stage right, and that'sdefinitely a challenge.
I think the bar on Series A interms of survivability and
(35:25):
profitability has gone sort ofextraordinarily high.
I think Series A has reallybecome the Series B of the past,
though the check sizes stillremain the same, and I think I
would certainly like to see alot more aggression in terms of
decision making.
(35:46):
There are certain VCs who do agreat job of it.
You know.
They come in, they take a quicklook and then they pass it.
They give very good reasons forit, but it's also done in a
very finite period of time.
I have deep respect for them,but I think we you know founders
have been struggling a littlebit over the past 24 months,
where people are literallyexpecting them to be fully
(36:07):
profitable companies, even atthe Series A stage, and I think
that would be one that I thinkwe need to get back into more of
this venture mindset, becausefor those of us coming in at the
seed and pre-Series A, it'sfocusing on the wrong type of
investment sometimes, because ifprofitability is going to be a
(36:30):
requirement coming out of apre-series A stage of a company,
then you have to back a certaincategory of companies and
they're missing the high alphaof the company.
Speaker 2 (36:40):
One skill, amit, that every founder should master
Storytelling.
And why do you feel so stronglyabout it?
Because you require it foreverything, right, you might
think very obviously forfundraising, but as you're
growing your company, you wantto attract people that might be
10, 15 years more experienced,older, whatever than you.
You have to tell them whyshould they leave their fancy
(37:02):
fat paycheck at a Google, agoogle or meta or wherever right
?
Open ai and come join you,right?
So for employees, I think alsoimportant for your ecosystem
partners, right?
So this kind of adage fake ittill you make it love.
If you want to go partner withsomebody very large, you have to
convince them.
Why should they partner withyou?
You're like you want a littleai startup out of hsr layout,
(37:22):
right?
Like why should, uh know,perplexity partner with you or
whoever right, nvidia partnerwith you?
So I think it's a very corescale and I think, when I think
about notionally I mean I'dprobably get some big bats for
this, like US founders versusIndia founders I think this is
one where area where we don't doso well, right, which is that
you know telling your story toall stakeholders.
Speaker 3 (37:44):
I don't mean just investors, I mean I'm still
adding another piece to what uhmyth is saying, right?
Which is?
It's so important, this pieceof storytelling, because while
one might think that you know,investments are made by looking
at spreadsheets, actually theyare made based on the excitement
the investor has of beingparticipant in a dream journey,
in that journey, right?
(38:04):
So how do you actually createthat?
It's not just aboutpresentation, actually it's not.
It is about deeply thinkingabout what is it that you're
building?
And they're just picking themost relevant aspects and
beating it into a narrative thatis relevant and it makes sense,
whereas lincoln once issupposed to have said, after
having written a five-pageletter to his friend, that I'm
(38:25):
sorry for writing you such afive-page letter because I don't
have time to write a one-pageletter, right?
And which is hard because youneed to both think deep and
figure out what you don't wantto talk about, and this boils it
down to the things which you dowant to talk about.
So I think that the beststories have that element to
them that they just focus on thepoor thing, and it's not easy
(38:46):
and it takes time and it takespatience to craft it.
Speaker 1 (38:51):
I'm into boiling things down.
I'm going to disagree a littlebit here.
Why?
Speaker 2 (38:55):
And on what point?
Speaker 1 (38:57):
On the point, or the perceived importance of
storytelling, because I thinkmost people don't understand
what it means to be a goodstoryteller.
I think Sheputi sort of alludedto a little bit to it at the
end, right?
So it's very important forfounders to really have clarity
of intake, first, in terms ofwho they are.
(39:18):
Who is their customer?
What problem are they aiming tosolve for this customer?
What is life for the customerbefore this today, and what is
life going to be in the event?
They're going to be successfuland why their success matters.
That's really all they have tosay, right?
And I think, to some extent,what people tend to when they're
(39:39):
told they're poor storytellersthey go off and they start
trying to create a story andthen the authenticity goes away
from them, right?
So, while it is important to begood storytellers, while it is
important to be very crisp andfactual, you have to stay true
to your knitting.
You can't become an artificialstoryteller.
You can't create a story ofyour life that doesn't exist
(40:01):
just because it appears, andeverybody, unfortunately, is
what Shark Tank and thinks thatthat's how they need to narrate
their story.
That is not what we are talkingabout, right?
We are talking about beingauthentic.
We are about being very clearand crisp and saying these four
or five things that you need tosay in a cohesive manner, right?
I think that's the importantpoint.
Speaker 2 (40:22):
So, coming to clarity , Sripati, one question for you
what would be the most importantmetric for startups in
Qualified I think it will bemore of the same.
Speaker 3 (40:30):
I think it's going to be unit economics and making
sure that you craft uniteconomics that are relevant to
your business.
We often see entrepreneurs whosay, hey, look for my business,
daos are this.
Sometimes you think back andsee entrepreneurs will say, hey,
look, you know, for my business, you know, daos are this.
Sometimes you think back andsee, well, actually, dao might
not be a relevant metric foryour business because it is not
(40:51):
a business in which thecustomers actually are expected
to come every day.
Right, the usual behavior of acustomer is something else.
So what I have seen is that weblindly copy.
You know what metrics aresupposed to be relevant.
Churn might be defined acertain way, something else,
retention, et cetera.
So trying to understand what iscore to the particular business
(41:14):
at hand and then crafting themetric around it is an important
thing.
So I feel that that willcontinue to be very important,
because anything AI is gettingfunded right now.
There's potentially a bubble,but we see businesses do go
through that.
In fact, there's nothing like anormal time.
It's only feast or famine, atleast in my experience, which I
(41:35):
have seen.
So there might be feast, butjust because you have raised
money doesn't make it successful.
It just increases the barhigher for you to jump over in
order to be successful.
So I feel that the foundersneed to be acutely aware that
they are building a realbusiness.
What is it that they need totry?
Speaker 2 (41:51):
And for that is unit economics.
Speaker 3 (41:52):
And the unit economics.
Speaker 2 (41:53):
yeah, Sanjay, one piece of advice that founders
love to ignore but should not.
Speaker 1 (42:01):
I go back to what I said earlier Communicate,
communicate, communicate.
Probably the only other thingI'd say is this is a marathon.
Things will go wrong along theway.
There will be moments when youneed to be able to sprint, but
for the most part, conserveenergy at all levels, and
completing is most important.
(42:23):
Coming first is more so.
As long as you get to thefinish line, good things will
happen.
To get there in the top 10,extraordinary things might
happen, but I think focus onfirst staying alive at all times
.
Speaker 2 (42:38):
Amit, any closing thoughts?
No, I think 2025 is going to besort of hopefully kind of
harbinger this notion of beingmore predictable, whether it's
in communication, whether it'sin numbers, metrics, unit,
economic, you know, having thebusiness do what you said it
will do and I think this isagain back to the IPO mindset
(42:58):
that the more predictable you'regoing to be, it doesn't mean
high or low, right, it iswhatever it is.
That is your stated target.
You know, budget versus actual,the very old fashioned kind of
way of doing it, and that couldbe on hiring, that could be on
expanding to internationalmarkets.
So being more predictable issomething that I think the folks
that do that will be a lot moresuccessful than the ones that
(43:20):
sort of wing it.
Well, that is it for our firstpodcast of 2025.
Thank you so much, sripati andSanjay, for joining us and
sharing your views and, to ourlisteners and viewers, thank you
so much for following us andlook forward to seeing you next
time and have a great 2025.
Speaker 4 (43:42):
Dear listeners, thank you for listening to this
episode of the podcast.
Subscribe now on your favoritepodcast app.
Thank you.
However, you get your podcasts,then hit subscribe and if you
(44:03):
have enjoyed the show, we wouldbe really grateful if you leave
us a review on Apple Podcast.
To read the full transcript,find the link in the show notes.
Dear listeners, thank you forlistening to this episode of the
(44:24):
podcast.
Subscribe now on your favoritepodcast app for free and you'll
be the first one to know whennew episodes are available.
Just search for Prime VenturePartners Podcast in Apple
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(44:47):
To read the full transcript,find the link in the show notes.
We actually can deploy anywhere up to $10-12
million per company right.
Speaker 2 (00:08):
I think this is going to be the year of more IPOs
from Prime and Prime FamilyLaunching our new fund.
Speaker 1 (00:15):
Now we've got LPs from the Middle East.
We've got new LPs from Europe.
Speaker 3 (00:19):
Taking fewer bets but going deep in those bets.
Speaker 2 (00:23):
What should the VC stop doing in 2025?
Speaker 1 (00:26):
Everybody, unfortunately, has watched Shark
Tank and thinks that that's howthey need to narrate their
story.
Speaker 2 (00:31):
Most founders do not pay attention to dashboards, so
what is the right time to thinkabout an IPO.
Fundraising requires anenormous amount of storytelling.
Speaker 1 (00:39):
I'm going to disagree a little bit here why I can say
that as a South Indian.
Speaker 2 (00:49):
Hi everyone, happy New Year.
Welcome to Prime VenturePartners' first podcast for 2025
.
I'm Brij and I'm joined with mypartners in crime and in prime,
sanjay, tripathi and Amit.
So today we are going to talkabout what's in store for 2025,
especially for Prime, for theecosystem and generally for the
(01:10):
tech startups.
So we'll get started no holdbarred, candid conversation, no
scripts, except for the onesthat I'm carrying, so let's get
started.
So I'll start with you, sanjay,first, and especially from the
prime venture partnersperspective, what has 2025 in
store for us?
Speaker 1 (01:29):
2025.
What, what, what we have instore?
Uh well, very excited to to saythat we'll be uh uh launching
our new fund and uh fund, whichwill be fund five for us, and
it'd be similar to the tocurrent fund four, you know, in
the 120 million dollar range,and we continue to be focused on
(01:51):
early stage companies, backing,you know, four to five new
companies per year, as they'vebeen doing pretty much for the
last 14 years that we have beenin business here and you, you
know, the fund itself.
I think what has been gratifyinghas been strong support from
several of our existing LPs, butthere's also been a drive to be
(02:14):
much more institutional andwe're going to have several new
high quality institutional LPsfrom around the world joining us
in this journey as well, aswe've seen a lot of interest in
India as a whole and met somevery high quality, limited
partners from really allgeographies.
It used to be much more ofNorth America and perhaps a bit
(02:36):
of Southeast Asia for us, butnow we've got LPs from the
Middle East, we've got new LPsfrom Europe and to join us as
well.
Speaker 2 (02:46):
Shripati, anything from your side about Prime's
approach that is likely toremain the same or change?
How are you personally lookingat Prime Venture Partners in the
year 2025?
Speaker 3 (02:56):
So we will, in many ways, just continue to do what
we strongly believe is our wayof investing, which is taking
fewer bets but going deep inthose bets.
So we are fairly unusual amongearly stage investors in that we
take concentrated bets, whichis four to five deals in the
(03:20):
year, but we stay with themthrough the journey, with the
companies you know andcontinuing to participate in
investment rounds and thefollow-on rounds as well.
So that will remain the same.
So we'll be patient investors.
I feel that we'll be spending alot of time with our existing
portfolio companies in terms ofhaving them both incorporate and
(03:44):
navigate the changes that AIand the opportunities that it
brings.
I feel that the growth stagecapital for all companies will
continue to be a challenge forwhich they need to overcome,
because, while there has been avery large expansion in the
early stage capital which isavailable in India, there are a
(04:04):
number of new micro VC fundswhich have come up in early
stage and even angel checks noware fairly large, which is all
positive and indication of ourmaturing ecosystem but still the
bar for raising growth capitalwill continue to be fairly high.
So, looking for opportunitieswhere the entrepreneurs
(04:25):
understand that bit and alsomaking sure that our portfolio
understands that there'llprobably be an impact.
Speaker 2 (04:33):
Amit, over to you, I think, beyond Prime's
perspective, I'd also like youto touch upon broad spaces,
themes that you are personallymost excited about in the year.
Sure, so on the Prime front, Iwould say, firm, like we've said
, is over a decade kind of oldnow, so I think a lot of
companies are maturing at agrowth stage.
(04:53):
So I think this is going to bethe year of sort of more IPOs
from prime and prime family, butmore broadly, I would say,
cultivating an IPO mindsetacross everyone.
One of our founders, founder ofNavdhan, said it best at
Founders Day last year, whichwas that you know what is the
right time to think about an IPO?
His answer was the day youincorporate your company or
(05:16):
think about incorporating.
And to me that is actuallyreally, really profound, because
it is very different thanreporting some loosey-goosey
metrics to VCs and saying it'sokay, we'll do.
This is, you know, cumulativeaccounting.
This is that kind ofaccumulated ARR, this is, you
know, accrual, non-accrualcashflow.
The rigor to run yourself as apublicly traded company is a
(05:39):
very, very different kind ofrigor.
So, helping the broaderportfolio and certainly the
growth stage companies hopefullyyou know a couple of them will
go IPO next year or this year.
So we'll.
That is fun.
In terms of sectors, I would saylook, we do a bit of top-down
but we're also very bottoms-upinvestors, right.
So, in fact, last year you leda deal in the space of precision
(06:01):
fermentation, something thatnone of us knew about before.
You kind of brought that up tothere.
So I think there are going tobe interesting opportunities
bottoms up to build for India,for Bharat, for AI, for vertical
AI, etc.
And then the core sectors willremain right.
So fintech, ai plus SaaS, youknow, vertical AI those will
remain.
So those are the areas that B2Bthat we continue to remain
(06:25):
excited about.
Shrivati, I know you have beenspending some time on deep tech,
space tech, robotics, right.
You keep tinkering around allthose areas.
Anything around that that youare excited about in the year
2045?
Speaker 3 (06:41):
Definitely.
I feel that both of those whichyou touched upon, bridge, which
is robotics and space tech, arevery exciting areas.
So, when we think aboutrobotics, there is automation,
which is essentially taking aregular process and introducing
automation through robots inthere, and then there is
(07:02):
essentially, you know, theequivalent of self-driving cars,
which is autonomous systems.
So I feel that we are going tostart seeing automation
happening a lot more ubiquitousacross industries than
autonomous systems.
I feel autonomous systems arefairly hard and the last 10% or
15% of getting that safe andcorrect and so forth is going to
(07:26):
take a long time.
That's my belief.
So, on the but, however, whatwe traditionally usually think
about as robotics is a lot ofautomation and there's a lot of
value to be added there.
And this happens because nowthe AI models are becoming
smaller, they are becoming muchmore contained to run.
They can be run in their ownenvironment without having to be
(07:46):
dealing with a lot of compute.
This is the inference piece,because once the model has been
made, the inference can actuallybe much more fine-tuned and run
and vision is becoming muchmore powerful.
So they combine all of thesethings together.
I think automation is going tobe a very big team.
We have an industry which isco-led in manufacturing AI,
which is an example of that, butdoing things which is not
(08:10):
possible On the space tech side.
There are the force, thetaguins here, in terms of both
the support which we are gettingfrom the government and also
new areas which are opening upfor space tech.
Both in the defense side and inthe private sector side,
increased the total addressabletime very significantly and I
(08:33):
think the Indian startups thereare very well positioned because
we have both the talent and theecosystem which is conducive to
that.
Most countries do not haveecosystem necessarily to do that
, so I'm fairly excited aboutboth of those things I wanted to
just get back to one sort ofpoint about our fund right.
Speaker 1 (08:55):
We made a very conscious effort to keep our
fund size the same right, and Ithink this is sort of gone
against what you know we see,certainly with our peers, whom
we have deep respect for andgeneral mindset of, you know,
growing a fund.
And the reason we believe youknow this is the right thing to
do is, you know, actually a $100million fund is a very large
(09:20):
fund for early stage where wecan write some fairly
substantial checks too.
So the quantum of check we canwrite, whether it's anything
from 500K to $3.5 million at theseed stage or at the start of a
company, it's really quite asubstantial amount.
And with a concentratedportfolio, because we will
(09:42):
typically have 14 to 16 deals inthe fund, we actually can
deploy anywhere up to $10-12million per company right For
companies that are doing wellover the course of a couple of
rounds.
So I think what we wanted tomake sure is that we stay with
what has been true to ourknitting and what has resulted
(10:05):
in some extraordinary outcomesfor entrepreneurs, whether it
was happy or easy tap or quizzesor companies like my gate
wheels, you know, reco, where wecould have meaningful time to
spend with the founders, andthat you hear also now in.
All of us have entrepreneurialbackgrounds.
We feel that for founders andmore so we're seeing now
(10:29):
founders value the fact thatthey're not just getting a check
but they're getting qualitytime, and they're getting
quality time perhaps across thefour of us and our extended team
.
And for that to happen, youactually need to be in this
mindset of doing very few dealsdeals, but spending a lot of
quality time with the founders,and that triangulates back to
(10:49):
you know, the size of the fundand how we can deliver
extraordinary outcomes forentrepreneurs, our limited
partners or our investors, aswell as for ourselves, right?
So it was a very conscious andthoughtful decision to keep the
fund size the same and probablyinvolve a lot of discipline and
a lot of brainstorming, as youare aware.
(11:10):
So I just wanted to put thatout there as well for people to
understand the life of a VC andthe responsibilities of a VC,
and the ability to be patientwith entrepreneurs and build
large companies.
Speaker 2 (11:23):
Absolutely.
I think from similar storyplays out when you are building
a company, that's always easierto raise a larger and larger
amount of capital.
But eventually it's aboutbuilding a company that can
sustain over a period of timeand you raise an adequate amount
of capital to achieve that goal.
So it's very difficult at timesto hold on and stick to your
foundational principles and Iguess we all went through that
(11:45):
period last year, in spite ofall the attraction, interest
from outsiders.
Right, he said, we'll stay trueto the fund size that we have,
we'll stay true to what we havestarted out building at prime,
and I think that fund size givesus the best equipment to
achieve that goal you know avery well-known vc, uh told me
in my first week on this jobgood companies don't die of
(12:07):
starvation, but they can die ofindigestion.
Speaker 1 (12:09):
And I think the same philosophy is something we also
try to practice there.
You know, stick to yourknitting right.
But really excited again, asShri Patel said, about the
opportunities we have seen.
Speaker 2 (12:22):
So we'll go into spending some time around
founders playbook and the threeof you come with your own
operating and entrepreneurialexperience, but also decades of
now seeing multiple companiesfrom the boardrooms, and I want
to talk about specific do's anddon'ts, right, what founders
should do, should not do.
We'll start with you, amit.
(12:43):
Right For new founders enteringany space or raising capital,
what are the areas or themesthat you will recommend that
they prioritize?
If you were to be a new start,new founder in 2025, which areas
and themes will you recommendthey start out?
I think areas and themes areprobably best picked by them.
(13:04):
In fact, we joke about it often, right?
This whole notion of you know Amarket, b team, b market, a team
is eventually it's really theteam, right, because Sanjay
articulates this well thatthey'll pick the A market kind
of thing they should think aboutin that opportunity, right,
(13:28):
which is how can this be a verylarge opportunity?
Not every opportunity isnecessarily vc backable, right?
Uh, so the size of theopportunity is very, very
important.
The second thing is that,because you could build a
lifestyle business, a very good,attractive business, but it may
not be venture backable interms of both.
You know, velocity, speed anddirection and and the quantum of
the outcome that's possible.
The second is depending on thekind of business, people don't
(13:50):
spend enough time thinkingthrough distribution.
Typically, founders tend to befrom a product or engineering
kind of heritage, so you'realways keen to build something
and then we'll figure it out.
And not enough time ondistribution, right?
One of my learnings from thelast 10 years has been that,
look, it is as much aboutdistribution as it is about
product, if not more so.
(14:10):
Right, which is a little bit,you know, sad and paradoxical as
a product person.
But that is one.
Think through enough in termsof how are you going to get this
to customers?
Are the customers ready forthis?
Is this a real, meaningful topthree, top five problem?
Will they deploy it, et cetera.
And the last one is lookthrough good times and bad.
(14:31):
In the last three years havebeen a bit choppy right 22, 23,
24, now on to 25.
I think fundraising requires anenormous amount of storytelling
and being able to articulateboth the narrative and the
numbers right.
So I would say it's not just toget started, because you could
get started just on pedigree, oryou're from Magic Pen or Zomato
(14:51):
or XYZ or you know you're, butthen to say how is this going to
be a large company?
So I would say a few morethings beyond just the here is
the product prototype that I'mthinking of would be some things
that I would encourage peopleto think about.
So, start the company.
If you have to start for theright reasons.
Especially, founding is not acool job, right, it's absolutely
(15:11):
not.
And I think once you start iswhen you realize that, if you
start for the wrong reasons,that it is a slippery slope,
absolutely so Sripati amongstthe current founders, right,
there has always been every year, there is a dilemma between
(15:32):
growth and profitability, orboth, I think.
What do you think has 2025 instore?
So do you think it will be?
Speaker 3 (15:35):
about prioritizing growth, prioritizing
profitability.
How do you think about it?
So one rule of thumb which, uh,which I heard and I believe, is
that you need sustainablegrowth, which means that your
unit economics need to be solidwhen you're growing.
But also remember that at thisstage, you're a venture company.
One point of growth is worthlike three points of
(16:00):
profitability, and what I meanby that is that you often see
situations where founders arevery are plagues that why their
company is not getting fundedwhen they are profitable,
whereas some other competitorhas gotten funded and they have
not dropped.
And it's important to understandand this is fairly basic, but
it's worth repeating thatinvestors are looking for future
(16:22):
growth and future profitability, right, and they're looking at
the company state currently tosee whether this is a good proxy
for a future growth and futureprofitability.
And if you don't have good uniteconomics, the current revenue
is not a good proxy for futuregrowth and profitability, right.
That's because if uniteconomics are not good, it means
(16:45):
you have to raise a lot ofmoney to continue your growth
and your profitability is an unquestion mark, right, it's a
more risky investment.
However, the other end of thatspectrum is low growth and good
profitability.
In that case also, you are asan investor, you're in a dilemma
because now you have to betwhether okay, can this actually
(17:06):
grow, whether this market islarge enough or is the product
good enough to access the marketsize for this to grow.
So it is obviously a trade-offwhich founders have to make and
it is important to know that inthis case, if you're shown
validation that you're seeingsigns of good growth yet your
utility economics are fine, youmight still be losing money.
(17:28):
That's okay.
That's one which makes for anattractive company.
And the second is having theunderstanding that you're not
beholden to the market providingyou a certain amount of capital
at a certain amount of time, ina certain period of time to
actually grow your company.
What I mean by that is havingyour own destiny in your own
hands, which means that, ifneeded, you can actually become
(17:52):
a very low-burn company and thenactually be able to raise when
the capital markets open up.
We had talked about in theprevious podcast about edtech
and so forth.
You could be a very good edtechcompany, but if suppose the
environment is negativefortunately scenario it's turned
around, but if it continues tobe negative, you have to just
wait you might be a greatcompany.
So in those cases, having theability to just lower the burn
(18:18):
and sustain and become close toprofitability, these are all
like elements of building abusiness which I feel will
continue to be very important.
Speaker 2 (18:26):
And there is always this cyclicality in the startup
ecosystem.
Right, there are periods ofconsolidation.
Profit is the only thing thatmatters.
Then you will see suddenly aboom of growth, growth, growth
at all costs.
I think the last two, threeyears we have been sort of in a
good equilibrium where companiesare prioritizing profitability
(18:47):
and, as you mentioned,sustainable growth.
Do you see the risk that itmight change in the coming year
or in the coming two years, thatwe might be seeing another
bubble form?
Speaker 3 (18:56):
Well, I think this has always remained true.
Two 30 years ago.
It will be two 30 years fromnow.
These are the companies will bevalued in the long term on the
current value of future cashflows.
So you're not going to go wrongif you're going to believe that
now.
The reason why these thingschange is that that is the state
you want to get to, whereyou're actually generating
enough cash flows and growingand people are going to value
(19:18):
that way, which is how publicmarkets tend to look at
companies, right, so I feel thatfounders shouldn't get confused
about which way the cycle isgoing to go and which way the or
what the current zeitgeist isin the market.
The better way to think aboutit is that by solving a problem
and this is there a large enoughmarket opportunity for me and
(19:40):
the solution which I have thatactually provide providing that?
Yeah, absolutely, and if youcan convince yourself that, most
likely you're going to be ableto convince an investor, and
it's okay.
The investors are in thebusiness of risk capital.
They know how to take risks andsometimes they'd be wrong.
Most of the times they might bewrong, but they also understand
that at some point, if they'repatient, the tide is going to
(20:01):
turn B the idea is going to turnin their way.
Speaker 2 (20:05):
If I may add to that, I think now with a lot more
companies going public, even onthe Indian bourses there is an
external benchmark valuation,which was often not the case in
the private market.
Companies were staying privatefor very long.
I don't remember what Facebookwent IPO at almost 100 billion
market cap or some crazy largenumber.
(20:25):
You didn't really see what theactual value of the business was
.
Right, because it was only setby, you know, the private market
or some subset of the privatemarket.
So once there are things thatare public so now you can see
the stock valuation of adelivery or you can see the
stock valuation of attraction orwhatever then you say, ah,
these are the benchmarks thatare out there.
(20:49):
So I think a random bubble isless likely to happen, although
bubbles have been there forhundreds of years, not just
dozens of years.
So I think they'll come and gofrom time to time and I think
when founders are starting thecompany, they need to keep this
in mind that what their endstate valuation, size of the,
how this company will be valuedis now known Absolutely 10, 12
years ago.
Sanjay, you have been on manyboards, right?
What is one behavior and I willcall it, I'll say, your pet
(21:15):
peeve in terms of founderbehavior that they should
absolutely avoid.
Speaker 1 (21:19):
I always believe, you know, in over communication and
you know, as the saying goes,good news takes the staircase,
bad news takes the elevator andit's very obvious things are not
going to plan when foundersstop communicating or slow down
their communication.
I saw this even in some otherpodcast I was listening to the
(21:39):
other day saying, wow, I'm notthe only one who's observed this
.
Right.
So I think, you know, trust isa very important part of the
relationship, you know, betweenfounders and investors, and
investors are not their bosses,right?
I mean, if anything, it's theother way around.
Right, and it's important forfounders to establish that
(22:03):
relationship with their board orinvestors that they can bring
and discuss bad news with them.
Right, and I think the mostsuccessful founders are those
that you know will call you andsay I screwed up or something
has gone wrong here.
Right, and there's no shame init.
Right, it is what it is.
We are in this boat together.
(22:23):
Once you know your logo is onour wall there, we are in this
together.
There's no choice, there's noeasy way out, even if you're
bonded to part ways.
So the reality is you have tostart working together and
trusting each other, right, andto me, that's the one thing that
, as much as most founders sortof figure that out, over a
(22:44):
period of time, some of themwill struggle right, and they're
all human beings Nobody feelsgreat about ourselves when
things are not going well.
But that's also the opportunityto seek help, whether it is
with your board, whether it iswith other advisors, other
mentors, et cetera.
And that, to me, is a pet peeve, and I sense it very often,
(23:07):
because we typically will have aWhatsApp group with founders
and they'll be sending the mostarbitrary of things, which has
nothing to do necessarily withtheir success, because business
is going well.
But the moment business isgoing a little sideways, you'll
start seeing the frequency ofcommunication come down and I
think you know for most founders, that is the moment when they
(23:28):
should actually be much morecommunicative and transparent.
Speaker 2 (23:32):
Very well said you, being a founder in a startup,
that's gone through some bigdifficulties and I think it's
typical human tendency to go inyour silo, just go hunker down
and try and build and get out ofthat rat hole.
But I think the best thing onecan do is to actually share,
seek help and, finally, that'show relationships increase.
Trust right, that's howfounders and investors can work
(23:53):
together with each other insteadof being against each other.
Especially.
Speaker 1 (23:58):
Shibati says this from time to time right, being a
founder is very lonely and whenyou're in this and this is all
you're doing, this is your life.
Right, you may not want to tellyour family that things are
going poorly, because you don'twant others at home to get
stressed out Already.
They're seeing you working andoverworking and so on, and your
(24:18):
friends also generally want tobelieve that you're in control
of things, or, with your team,you have to say that you're in
control, so that actually leavesthe board where you can have
these confidential conversations.
That's a safe space forfounders and it does.
Perhaps you know a handful ofmentors and advisors, right?
So whoever you find is in yoursafe space, you know you should
certainly work with the,communicate with them, um, but
(24:40):
as investors, you know, I think,um, we are all you know.
The other advantage of workingwith investors is because we
have 50, 60 companies on ourportfolio and I can guarantee
you the other 59 are not havinga great time and you're the only
one struggling through.
What you're experiencing isprobably something that many of
the others are currently goingthrough or had gone through, and
(25:03):
maybe it could be fatal or,most likely, there is a solution
that, uh, you know, and you'rejust, you just be normal no,
absolutely.
Speaker 2 (25:11):
Especially when you're founding and building a
company, it's very, verydifficult sometimes to realize
that everyone else might be insame boat as other founder
friends of yours.
Right, and that's, I think, theboard and that place is a very
important place to be open andtransparent and just believe
that you will get out of it safeand sound.
On the other side, everycompany goes through it right.
(25:33):
It's not a surprise.
Speaker 1 (25:34):
I think the other thing and it is something that
probably I still am working onmyself is embracing
confrontation when things arenot going well.
You know, maybe you disagreewith your investor.
You know this whole.
People talk aboutpassive-aggressive right, where
you agree in the meeting butactually don't intend to follow
(25:54):
up on it.
That's probably the worst thingyou can do and that adds up
over a period of time, right?
So I think in general in Indiawe are brought up to not be very
aggressive, not confront.
Certainly in in India we arebrought up to not be very
aggressive, not confront.
Certainly in South India it'sprobably more true.
I can say that as a SouthIndian, but you know it's the
(26:15):
right thing to do sometimes,right, and it doesn't mean you
can disagree without beingdisagreeable, right?
And these are some techniquesand this sort of comes back from
its point of communication andstorytelling and all of these
things.
They all sort of come together.
Speaker 2 (26:29):
So I'll move to Shripati to you.
So 2024 was about the Indiastory.
Right, and as part of our ownfundraise, you would have
interacted with many of the LPs.
How are you thinking, or howare they thinking, about the
India story in 2025?
Speaker 3 (26:43):
I feel that clearly, if you look at emerging markets,
india is one of the mostattractive destinations for
investment, given just the sizeof the opportunity we have and
just the rest of the ecosystem.
We have a stable politicalsystem, we have a stable
(27:04):
economic environment and, ofcourse, we have the talent and
India has always been a placewhich has attracted venture
capital right.
So I feel that most of what weare hearing is that it is a lot
of the stars are aligned forIndia to actually grow very well
and continue the growthtrajectory and for startups to
(27:25):
play a very major role, not justin India, but outside India as
well.
I think there will be certainuncertainties and bumps in the
road.
I'm very much a thing that's apart for the post, as there's no
linear straight line which goesup.
There will always be ups anddowns, but I feel that we're
just very well positioned andsome of the areas which we
wouldn't have previously thoughtof as, uh, as interesting area
(27:48):
are now becoming, you know,venture invested.
So manufacturing is one of them,right, uh, because several
years ago we were probablyunclear how manufacturing is
going to uh, you know, reallytake root in india, what kind of
investments we're going to see,and now we're just seeing that
shift happen, uh, in a verysignificant way, and that means
that a whole bunch of downstreamactivities and supply chain and
(28:11):
enabling products and so on andso forth become opportunities
for us to invest in.
So there is a lot of excitementand we think that, as we saw,
our participation in our fund isan indication.
I think, that the Indianventure ecosystem is going to
see much more participation fromglobal investors.
Speaker 2 (28:34):
At least this year, we will see the continuation of
India's story or many years togo.
Speaker 3 (28:39):
To the extent that I can predict, yes.
Speaker 2 (28:40):
Yes, okay, Sanjay, I am not going to let you off the
hook on the Fintech side.
I remember that you.
What is it?
The Fintech side?
I remember that you.
So what is it in Fintech thatkeeps you still excited now and
20 years from now?
Speaker 1 (28:53):
I think, huge gap in access, huge impact and huge
profit pools to tap right andwith no winner-takes-all
requirements here.
Of course one would want to bea dominant player in whichever
company we're investing in, butyou really don't have to be the
(29:16):
number one or number two even tobuild a large company.
So, success, the price isreally worth winning.
I think that's my highest order.
But in anything we invest in,is the price is really worth
winning?
I think that's my highest orderbit.
In anything we invest in, isthe price worth winning?
Because I believe it's harderto build a small company than to
build a large company.
Right, because in the beginning, you know, it sounds really
(29:39):
sort of like how audacious isthis thought process.
But once you start showingsuccess, the world sort of
conspires to make you successful.
Right, and I think in fintechyou'll see several of these
opportunities.
Indians are, you know, juststill coming into the digital
age and getting you know intothe mainstream A lot of
(30:00):
businesses have the first pieceof formalization happened
through digital payments.
And then, on the consumer side,yes, that footprint, as well as
the formalization of the salarysystems and things like that,
has brought everybody into amechanism like MyGate,
digitizing all the Maycob DriverGardner.
(30:22):
All of a sudden now there issome digital data about them and
people are starting to pay themin their bank accounts.
Now you can see all thispredictability of income.
Maybe one could give them apayday advance loan or something
like that.
Right Education you know Amit'stalked about the third coming
of ed tech in the past andpeople are getting through more
and more formal and sort ofskill-based you know, learning
(30:46):
right.
That leads to income generation.
They start becoming much morecreditworthy Now.
You know lending to someonelike that again is very
effective.
And you look at the small stores, you know.
I know there is a lot of debateabout whether Kiranas will
survive and that might be truefor groceries and stuff.
(31:06):
But all the other, you knowbuilding construction, whether
you're an electrical store, aplumbing store.
You know selling car batteries,etc.
Working capital is the crucialrequirement.
It's really oxygen and they'veall been starved of it, not
because they're not creditworthy, because there was no data to
say that they were creditworthy.
So all these opportunitieswhich are deemed to be priority
sector are core to the GDPgrowth that we are projecting
(31:31):
here in India, and financialservices is going to be the
lubricant that's going to fosterthis, and startups will have a
huge role to play, so we'll gointo sorry, the last one.
That is also the boom incross-border right and we've
talked about LKM, which is thecompany in our portfolio.
That's the first one there andagain there in the cross-border
working capital results be ahuge requirement.
(31:54):
So I think this is a continuousopportunity here.
Speaker 2 (31:57):
No wonder you are excited about for the next 20
years.
So I'll go into the lastsection, which is the section
I'm most looking forward to.
So I'll ask one of you rapidquestions, and you need to reply
rapidly, but then you need toslowly explain why did you give
that answer?
So I'll start with you, sanjaythis one.
Speaker 1 (32:18):
I think you should start with going alphabetical
order when I'll go with Amit.
Speaker 2 (32:21):
So, amit, one thing founder should do immediately in
2025 pay attention tofinancials.
Pay attention to financials andwhy.
You know, stay alive, know whatyour cash situation is, know
what it will take to grow, etc.
Etc.
Keep the company going.
Keep the company going both ata growth mode and at a survival
(32:44):
mode.
That will remain true forever.
And Sripati, one thing thatthey should stop doing, the
founders.
Speaker 3 (32:51):
Well, I think we should answer that question by
saying actually, most foundersdo not pay attention to
dashboards.
Okay, so it is a very simplething, but creating good and
actionable dashboards takes alot of focus and effort.
It takes six months, in myopinion, if you're actually
focused on it, to actually getdashboards which are consistent.
(33:13):
We talk about pet peeves inboard meetings.
It is just seeing differentnumbers are different in every
meeting.
Yeah, so if you have XYZ asyour business metrics in your
one board meeting and seeing ABCin the next one, what happens
with XYZ as your businessmetrics in your one board
meeting?
Speaker 2 (33:25):
and seeing ABC in the next one.
What happened to the?
Speaker 3 (33:26):
XYZ right.
They are kind of likedisappeared and not seeing trend
lines.
So I feel that it'scontinuously underestimated.
I'll give you an example.
Right, start seeing all theseadjectives applied to revenue.
You have gross revenue,adjusted revenue net revenue.
Speaker 2 (33:42):
Accounting revenue non-accounting revenue multiple
variants of that.
Speaker 3 (33:46):
This is like what we have done to contribution
margins.
Right, we have gone in andcompletely messed it up.
Now.
Contribution margin used to besomething which is like whatever
comes after all your variablecosts are taken off, no, you
have CM1, cm2, cm2.5.
You have, like all these kindof things which which keep
coming up.
So just taking a step back,having a term in your matrix it
(34:11):
just says revenue actually,which any big four accounting
person it will get from eny orpwc will also agree with and
which you might actually one daygo public with and and be able
to defend, would, for example,be very helpful, right.
So these are the kind of thingswhich I'm being a little
facetious, but the reason isthat taking the time and the
(34:34):
discipline to put these thingstogether and then consistently
following that actually helpsthe founders.
Good metrics, as Amit has saidpreviously, actually inform
behavior, and then it also helpsgetting the board be educated
on the nature of the company.
So that would be probably onething which I would say they
(34:54):
should both stop doing andperhaps start doing.
Speaker 2 (34:57):
So on to the VCs.
Sanjay, what should the VCsstop doing in 2020?
Speaker 1 (35:03):
I was going to say they should start funding more
of our companies and follow upon this.
And look, I think there'sdefinitely a gap in India at
Series B stage right, and that'sdefinitely a challenge.
I think the bar on Series A interms of survivability and
(35:25):
profitability has gone sort ofextraordinarily high.
I think Series A has reallybecome the Series B of the past,
though the check sizes stillremain the same, and I think I
would certainly like to see alot more aggression in terms of
decision making.
(35:46):
There are certain VCs who do agreat job of it.
You know.
They come in, they take a quicklook and then they pass it.
They give very good reasons forit, but it's also done in a
very finite period of time.
I have deep respect for them,but I think we you know founders
have been struggling a littlebit over the past 24 months,
where people are literallyexpecting them to be fully
(36:07):
profitable companies, even atthe Series A stage, and I think
that would be one that I thinkwe need to get back into more of
this venture mindset, becausefor those of us coming in at the
seed and pre-Series A, it'sfocusing on the wrong type of
investment sometimes, because ifprofitability is going to be a
(36:30):
requirement coming out of apre-series A stage of a company,
then you have to back a certaincategory of companies and
they're missing the high alphaof the company.
Speaker 2 (36:40):
One skill, amit, that every founder should master
Storytelling.
And why do you feel so stronglyabout it?
Because you require it foreverything, right, you might
think very obviously forfundraising, but as you're
growing your company, you wantto attract people that might be
10, 15 years more experienced,older, whatever than you.
You have to tell them whyshould they leave their fancy
(37:02):
fat paycheck at a Google, agoogle or meta or wherever right
?
Open ai and come join you,right?
So for employees, I think alsoimportant for your ecosystem
partners, right?
So this kind of adage fake ittill you make it love.
If you want to go partner withsomebody very large, you have to
convince them.
Why should they partner withyou?
You're like you want a littleai startup out of hsr layout,
(37:22):
right?
Like why should, uh know,perplexity partner with you or
whoever right, nvidia partnerwith you?
So I think it's a very corescale and I think, when I think
about notionally I mean I'dprobably get some big bats for
this, like US founders versusIndia founders I think this is
one where area where we don't doso well, right, which is that
you know telling your story toall stakeholders.
Speaker 3 (37:44):
I don't mean just investors, I mean I'm still
adding another piece to what uhmyth is saying, right?
Which is?
It's so important, this pieceof storytelling, because while
one might think that you know,investments are made by looking
at spreadsheets, actually theyare made based on the excitement
the investor has of beingparticipant in a dream journey,
in that journey, right?
(38:04):
So how do you actually createthat?
It's not just aboutpresentation, actually it's not.
It is about deeply thinkingabout what is it that you're
building?
And they're just picking themost relevant aspects and
beating it into a narrative thatis relevant and it makes sense,
whereas lincoln once issupposed to have said, after
having written a five-pageletter to his friend, that I'm
(38:25):
sorry for writing you such afive-page letter because I don't
have time to write a one-pageletter, right?
And which is hard because youneed to both think deep and
figure out what you don't wantto talk about, and this boils it
down to the things which you dowant to talk about.
So I think that the beststories have that element to
them that they just focus on thepoor thing, and it's not easy
(38:46):
and it takes time and it takespatience to craft it.
Speaker 1 (38:51):
I'm into boiling things down.
I'm going to disagree a littlebit here.
Why?
Speaker 2 (38:55):
And on what point?
Speaker 1 (38:57):
On the point, or the perceived importance of
storytelling, because I thinkmost people don't understand
what it means to be a goodstoryteller.
I think Sheputi sort of alludedto a little bit to it at the
end, right?
So it's very important forfounders to really have clarity
of intake, first, in terms ofwho they are.
(39:18):
Who is their customer?
What problem are they aiming tosolve for this customer?
What is life for the customerbefore this today, and what is
life going to be in the event?
They're going to be successfuland why their success matters.
That's really all they have tosay, right?
And I think, to some extent,what people tend to when they're
(39:39):
told they're poor storytellersthey go off and they start
trying to create a story andthen the authenticity goes away
from them, right?
So, while it is important to begood storytellers, while it is
important to be very crisp andfactual, you have to stay true
to your knitting.
You can't become an artificialstoryteller.
You can't create a story ofyour life that doesn't exist
(40:01):
just because it appears, andeverybody, unfortunately, is
what Shark Tank and thinks thatthat's how they need to narrate
their story.
That is not what we are talkingabout, right?
We are talking about beingauthentic.
We are about being very clearand crisp and saying these four
or five things that you need tosay in a cohesive manner, right?
I think that's the importantpoint.
Speaker 2 (40:22):
So, coming to clarity , Sripati, one question for you
what would be the most importantmetric for startups in
Qualified I think it will bemore of the same.
Speaker 3 (40:30):
I think it's going to be unit economics and making
sure that you craft uniteconomics that are relevant to
your business.
We often see entrepreneurs whosay, hey, look for my business,
daos are this.
Sometimes you think back andsee entrepreneurs will say, hey,
look, you know, for my business, you know, daos are this.
Sometimes you think back andsee, well, actually, dao might
not be a relevant metric foryour business because it is not
(40:51):
a business in which thecustomers actually are expected
to come every day.
Right, the usual behavior of acustomer is something else.
So what I have seen is that weblindly copy.
You know what metrics aresupposed to be relevant.
Churn might be defined acertain way, something else,
retention, et cetera.
So trying to understand what iscore to the particular business
(41:14):
at hand and then crafting themetric around it is an important
thing.
So I feel that that willcontinue to be very important,
because anything AI is gettingfunded right now.
There's potentially a bubble,but we see businesses do go
through that.
In fact, there's nothing like anormal time.
It's only feast or famine, atleast in my experience, which I
(41:35):
have seen.
So there might be feast, butjust because you have raised
money doesn't make it successful.
It just increases the barhigher for you to jump over in
order to be successful.
So I feel that the foundersneed to be acutely aware that
they are building a realbusiness.
What is it that they need totry?
Speaker 2 (41:51):
And for that is unit economics.
Speaker 3 (41:52):
And the unit economics.
Speaker 2 (41:53):
yeah, Sanjay, one piece of advice that founders
love to ignore but should not.
Speaker 1 (42:01):
I go back to what I said earlier Communicate,
communicate, communicate.
Probably the only other thingI'd say is this is a marathon.
Things will go wrong along theway.
There will be moments when youneed to be able to sprint, but
for the most part, conserveenergy at all levels, and
completing is most important.
(42:23):
Coming first is more so.
As long as you get to thefinish line, good things will
happen.
To get there in the top 10,extraordinary things might
happen, but I think focus onfirst staying alive at all times
.
Speaker 2 (42:38):
Amit, any closing thoughts?
No, I think 2025 is going to besort of hopefully kind of
harbinger this notion of beingmore predictable, whether it's
in communication, whether it'sin numbers, metrics, unit,
economic, you know, having thebusiness do what you said it
will do and I think this isagain back to the IPO mindset
(42:58):
that the more predictable you'regoing to be, it doesn't mean
high or low, right, it iswhatever it is.
That is your stated target.
You know, budget versus actual,the very old fashioned kind of
way of doing it, and that couldbe on hiring, that could be on
expanding to internationalmarkets.
So being more predictable issomething that I think the folks
that do that will be a lot moresuccessful than the ones that
(43:20):
sort of wing it.
Well, that is it for our firstpodcast of 2025.
Thank you so much, sripati andSanjay, for joining us and
sharing your views and, to ourlisteners and viewers, thank you
so much for following us andlook forward to seeing you next
time and have a great 2025.
Speaker 4 (43:42):
Dear listeners, thank you for listening to this
episode of the podcast.
Subscribe now on your favoritepodcast app.
Thank you.
However, you get your podcasts,then hit subscribe and if you
(44:03):
have enjoyed the show, we wouldbe really grateful if you leave
us a review on Apple Podcast.
To read the full transcript,find the link in the show notes.
Dear listeners, thank you forlistening to this episode of the
(44:24):
podcast.
Subscribe now on your favoritepodcast app for free and you'll
be the first one to know whennew episodes are available.
Just search for Prime VenturePartners Podcast in Apple
Podcast, spotify, castbox orhowever you get your podcasts,
then hit subscribe and if youhave enjoyed the show, we would
be really grateful if you leaveus a review on Apple podcast.
(44:47):
To read the full transcript,find the link in the show notes.
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