What Sucks About Being a Venture Capitalist

Welcome to another episode of investream. I'm Pankaj and I'm here with my friend Sanjay Nath, founder and managing director of Bloom Ventures. So a lot of people talk about, you know, life of VC and, you know, what's exciting about it, what sucks about being a vc.

See? Interesting.

I mean, I have my own views, but I want to hear your views.

You know, a couple of. I think it's. Well, you know, you know what's great, right? I mean, it's great to build a platform and have spent time with founders. Right. I think what is challenging or what is interesting is that you, you meet an entrepreneur, you fall in love with him or her in terms of what he's trying to build and change the world. And you realize that now you have not a bureaucracy, but you have a machinery.

Yeah.

And you have to go out and you get that into action to have IC process, to have the other team members meet them. And the founder really wants to just get ahead and build product or sell. Right. The two things. And they've got to, you know, they've got to spend time and come and meet your team members and of course, which is the right thing to do. That's always at the back of our mind, you know, the back of our minds that, you know, how can you move quickly with agility, yet you do the rigors. I think that's one the others, you know, to put on a blazer and a suit and, you know, go and meet LPs. But what is really interesting is we're finding that Today, I think LPs and investors are really getting interested by the founder stories. So one is returns, which of course is really important. You've got to have a healthy rr. And India's, you know, the challenge. And I think the conflict has been thrown for all of us to disprove the fact that India doesn't return or hasn't returned. Right. I mean, that's a challenge for all of us. But what is interesting is that we actually putting, we're putting our founders in front of LPs and, and they're really getting excited about this founder story. It's really, hey, wow, I met you in New York about five years ago now. I've come to Bangalore and seen you. Well, you've really grown like a company like Locust, for example, right. Which is new round investors, which is just right here down the street in New York. That's a great story because people say, wow, these companies are now coming out of India. It's great to See that they're building global stories. That's the interesting part. I think the challenging part is just, again, the challenge is that the quote, india has not performed as well as it should have. It's for all of us to disprove. So that kind of sucks a bit because people don't give you the right of way or that leap of. Or really the free pass that, yes, you do it. You have to prove. You really have to prove your metrics.

You.

Yes, you're performing. And there's this close route because I think India has.

And this is not just tech, but India in general has had a history of taking one step forward and ten steps back. From an economic perspective, whether it was banning Coca Cola or nationalizing industries or just regulation that just is out of control, all kinds of things. You know, there's. There have been a lot of investors who dip their toes in early and they got bitten and now they're shy about coming back in. And it does make all of our jobs a lot harder. But, you know, I think there are enough proof points now where, you know, sure. You know, we still only have one unicorn exit coming out of India in the last 20 years. Right. Let's say the last 15 years.

Which is Flipkart.

Yeah, which is Flipkart. I'm not gonna put Naukri and make my trip in that category because I think they're a little, slightly different. Say this cycle in the last 10, 15 years, Flipkart's the only one. That being said, there are some amazing companies that have been built, and the investors in those companies, some of them have taken money out of some of those companies in secondaries. And so the proof points are getting built by a lot of people now. So I think collectively, and you and I have talked about this, and I've talked about this with Karthik in the past, collectively, as a ecosystem, right. We need to beat the drums a little louder, right? And we need to really get in front of the right outlets and show that, look, here are our irs, right. Publicly put those numbers out there. Show people that some of those things we can't do because of regulatory issues, but really, as an industry, get out there and show people that, look, you know, this company was here today, it's here, and this is what's happened, right? And here are potential acquirers or ways of exiting. And I think that's something that as an industry, the venture capital angel industry in India, that's something that we haven't done so well.

Yeah, no, I think that's Interesting point. I mean, when you do this with Karthik, he'll open the kimono and he'll share all the numbers like he loves to do. But it's interesting if you think about, you know, some people have actually asked us, you know, are Indian entrepreneurs ambitious enough and absolutely they are. I think it's all been about the execution and building, about team building, scaling India Internet Day, which just happened like, you know, a couple of weeks ago, about three, four. I mean, it was a really audacious and ambitious, nicely ambitious tagline. 100 unicorns, right? That's what they wanted, I think, you know, Obviously China has 60. I think we have 20 today. India has 20 unicorns today.

Is it 20 now?

I think we have about 20. If you look at, you know, if you look at some who are like sunicorns, you add them, right? The gray oranges and the udans and you know, the others now Handstone from GGV and you know, the other investors from Chimingwall there, somebody wrote an article in the Times of India saying that India is not China, will never be China and should not be China.

I agree.

And, and nobody. But. But here's what's interesting. They were actually. It wasn't a knock on India, but it was like, you know, India's going.

To take a different path.

Different path. But Chinese Hans took actually came in and said that I'm super bullish on India. Yes, it can't be China, but we are here for a reason. Because should we capitalists come into three of our companies, they're looking at more, right?

Yeah.

The Chinese strategics and the Japanese are coming. We have Japanese LPs. You brought up an interesting point about sharing and writing and awareness. I think as an industry, I think we can all do much more to share because what happens is if there isn't data or if there isn't transparency, people just stay away. They say, oh, it's unknown, so I won't get in. So we need more proof points. Like you said, Flipkart was great. Bit was an anomaly because it was way out and right field, home run, out of the park. Secondaries and the exits are interesting because more money going out means more money coming back and renewed confidence, just like World Beach. So we need, you're absolutely right, to create an array to create a systematic, to create a scientific process or a scalable process of these returns going out, coming in. And we don't need necessarily 20 billion exits, to use a cricket analogy. And baseball. We need more tools and doubles, singles and Doubles. All of them don't have to be home runs, but we need a scalable area.

Absolutely. So I would urge you to talk to all of our friends back in India and do India Internet Day 2020 in New York City.

Okay, sure.

This is where all the customers are.

Absolutely.

The LPs are.

Well, you know what we could do is we could have a different versions. You can obviously have. You have the India version because that's where you get all the founders. But I think all of us, you know, you know, just like how the government of India had incredible. This is not really a rara. This is a very realistic look. I think what you do here is also great. You talk about the risks and you talk about what's good. It's not just a. Yeah, we have to balance it.

We have to tell a balanced story, and that's where we will gain credibility.

Right. And focus. You hit the needle, I think focus on customers and users. We all kind of obsessed about going to investors. Entrepreneurs, you know, just want to come and pitch to us all the time. Realize the end game is you get the growth and you get customers.

Investors will come, they'll chase you.

We follow. Right, Absolutely. Yeah.

All right, well, Sanjay, thank you so much.

Thank you.

Thank you for joining us again on investream. And I will see you again next time.

Great to be here. Thank you.

Thanks.

Thanks.