The Exchanges

Q Now, moving off in a slightly different direction, what book would you give to an aspiring entrepreneur? Is there one that particularly resonates with you that you have particularly been inspired by?

A Yes, there are two, if you don't mind me giving you two. There are two. I have both of them in front of me, so I'm looking at, you know, so one is a book by Ian Ares, and I'm probably mispronouncing his last name, A-Y-R-E-S, uh, and the book is called Super Crunchers, Why Thinking Numbers is the Way to be Smart. Um, I think in today's world, that is, that book was written quite a few years ago, but it's probably one of the most relevant books I would, I would, uh, encourage entrepreneurs to read. It's fascinating, quick read, fascinating stories, and great, uh, great message. And the other book is, the one that I actually just finished reading a few months ago, is a book by David Thompson, uh, called The Blueprint to a 1,000,000,007 Essentials to Achieve Exponential Growth. Um, and as entrepreneurs, um, you know, are trying to disrupt markets and, Get to the inflection point from where they take off. There's a lot that needs to happen. There's a lot that needs to do. It is, uh, challenging, and I think the, the book Blueprint to a Billion gives a very good, um, roadmap in terms of how to be thinking about it, how to be dealing with that scaling up, uh, challenge that most, uh, entrepreneurs hopefully face as they grow their businesses.

AI assessment note: “one is a book by Ian Ares... Super Crunchers... And the other book is”

Q Now, moving off in a slightly different direction, what book would you give to an aspiring entrepreneur? Is there one that particularly resonates with you that you have particularly been inspired by?

A Yes, there are two, if you don't mind me giving you two. There are two. I have both of them in front of me, so I'm looking at, you know, so one is a book by Ian Ares, and I'm probably mispronouncing his last name, A-Y-R-E-S, uh, and the book is called Super Crunchers, Why Thinking Numbers is the Way to be Smart. Um, I think in today's world, that is, that book was written quite a few years ago, but it's probably one of the most relevant books I would, I would, uh, encourage entrepreneurs to read. It's fascinating, quick read, fascinating stories, and great, uh, great message. And the other book is, the one that I actually just finished reading a few months ago, is a book by David Thompson, uh, called The Blueprint to a 1,000,000,007 Essentials to Achieve Exponential Growth. Um, and as entrepreneurs, um, you know, are trying to disrupt markets and, Get to the inflection point from where they take off. There's a lot that needs to happen. There's a lot that needs to do. It is, uh, challenging, and I think the, the book Blueprint to a Billion gives a very good, um, roadmap in terms of how to be thinking about it, how to be dealing with that scaling up, uh, challenge that most, uh, entrepreneurs hopefully face as they grow their businesses.

AI assessment note: “one is a book by Ian Ares... the book is called Super Crunchers”

Q And let's jump straight into it. Um, can you tell us a little bit about your background and what was really the driving force for you entering into the venture capital industry?

A Sure. Uh, I grew up in India and, uh, studied engineering in college and worked, uh, operationally running businesses, mostly doing engineering stuff for about four years. Before I came to the US to go to business school. And when I went to business school, I kind of got fascinated by numbers and finance, and I had never seen a balance sheet or understood what a P&L looks like before, even though I was running operating businesses. Um, and that intrigued me, and I spent the two years at business school really trying to master finance. But when I graduated from business school, I didn't want to give up my engineering groups, and I wanted to stay true to an, to be an engineer. And I still today think of myself more as an engineer than as an investor or as a finance guy. And I thought the best way to marry the two, which is my, ah, training and, and love and, and affection for engineering and excitement for engineering and technology, Uh, and yet also keep finance, and so I think venture capital is kind of like the perfect marriage between technology and finance, and that's what drove me to get into this business 15 years ago.

AI assessment note: “venture capital is kind of like the perfect marriage between technology and finance”

Q Absolutely, that's fascinating. And, and honing in a little on your own investment strategy, when it comes to investing in a startup, are there one or two must-haves for you for, to invest in a startup?

A Yeah. Um, you know, it's, it's, it may sound repetitive, or it may sound almost funny, but I think the truth of venture capital is that it's really all about the people. Uh, unlike growth stage investing or private equity investing where there is a business, there are financial analysis to be done, there are stuff to be looked at. When it comes to startups and innovation and really disrupting existing markets, it's, it really boils down to the passion of the person, the passion of the team, and the passion of the people starting the company. And so in my, in my experience, you know, the must have is the hunger and the, and the excitement and the passion in the, in the people. And it's, It's tough to evaluate, and that's why I think we oftentimes get it wrong, but when we get it right, Uh, the real guys who are going to innovate and disrupt the world are the ones who truly believe and maniacally believe in what they're trying to do. And in some ways, you know, in a funny way, I think about it as these are technology jihadists, if you know what I mean.

AI assessment note: “the must have is the hunger and the, and the excitement and the passion”

Q Fantastic. Thank you. And is there anything a founder can do before a pitch to put themselves in a good position to attain funding, uh, Be it researching you as an individual VC and knowing your background, or knowing the sector excessively well, or is there any in particular?

A Yeah, I think, uh, you know, it's all comes into, uh, comes in under the, um, subject of preparedness, right, or preparation. I think entrepreneurs should prepare. Um, if you come to an investor who, let's say, has been making only consumer internet investments for the last four, five, six, seven, 10 years, and you come to them with an enterprise big data idea, I think very likely you're going to be educating that investor versus getting his buy-in or having an intelligent conversation. And so it's important to understand who that investor is, what they've been investing is, what their experience has been, and what their successes have been, and what their failures, because oftentimes we are human beings. We do get jaded, and we do get experienced and influenced by our failures. And if there's something in the past that I have done, I had invested in, did not work out, that's going to leave a bias on it. It doesn't, you know, no matter what I say, it does impact my thinking. And if so, if it is in a certain area that I had invested in, let's say the company didn't work out, And if you come with a similar business plan, or a business in the same, same sector, you should be prepared to understand why, and at least engage in a conversation, why you'd be different, or why this is different. Um, and so I think it is, it all comes under preparation, and the more prepared you are, the…

AI assessment note: “it is important to understand who that investor is, what they've been investing”

Q Absolutely. And you said that you prefer the team to say an individual founder. Um, in, in that case, I mean, what, why is that? And what would you recommend to an individual founder? Would you recommend that they find a co-founder or, or persist?

A Yeah, it's a great idea, a great point. I think the reason I say entrepreneurs or a startup team is because, number one, it's very lonely being one. Being, being an entrepreneur itself is a very lonely journey, at least in the beginning in the startup, in the starting phase. Uh, and as you go out to raise money, oftentimes you'll be faced with challenges, people who don't believe in you, uh, people who kind of say negative things or try to dissuade you, even including your friends, family, and, and, and loved ones. And so, if you are the only one, and if you're single, I think it can be very, very difficult, and oftentimes discouraging, and oftentimes, um, torturous, that journey. But having a partner, I think, really helps, uh, to run ideas by, to make sure that you guys are teed up, and you run things through, and you, and you kind of challenge each other. Uh, the second reason, I think, is, I think two is always better than one. But I think at about three or four, it becomes a crowd. Um, and, and finally, I think, you know, it's, it's very difficult to find one person who is good at everything, or multiple things. You may have one particular skill set that you're really good at. Uh, so to compliment yourself, to bring in another guy whom you've convinced of the idea, who is also as passionate, and brings in a complimentary set, I think increases the odds of success.

AI assessment note: “the reason I say entrepreneurs or a startup team is because, number one”

Q And how do you evaluate whether a founder does have that passion and that drive? Is it, is it just in instinct? It's there from the offset or, or do you have to experience it over time over a few meetings?

A I think, uh, you know, over the last 15 years, I think I've built my own tool set as to how I can figure it out and how I try to figure it out. Uh, obviously it's not a science, it's an art, and that's why I think venture capital as a business, as an industry, is an, is a, is a, is an apprenticeship business, so you've got to acquire those skills and that talent over time. But I think it all comes across multiple ways in terms of, uh, the entrepreneurs or the founders really presenting when they present the amount of work they've done. Uh, their knowledge of the subject. Oftentimes they are, they are trying to disrupt something that they really don't have deep operating or long experience in, but they have the knowledge. They've acquired the knowledge. They, they firmly believe what's wrong. They've experienced something. They've experienced the difficulty because of which they are drawn towards a new business idea, and they're gonna solve the problem. Uh, they, they, they almost talk about it in an emotional way. It's personal in lots of ways. The, the, the pain point is personal. The problem is personal. And that's what drives them towards this, uh, uh, kind of like the call, if you will, to disrupt and to innovate. So I think there isn't, it isn't a sign. So I can't say, hey, you know, here are the, here are the three or four things you look for. But I think you, it's almost…

AI assessment note: “when they present the amount of work they've done. Uh, their knowledge”

Q Absolutely. And you said that you prefer the team to say an individual founder. Um, in, in that case, I mean, what, why is that? And what would you recommend to an individual founder? Would you recommend that they find a co-founder or, or persist?

A Yeah, it's a great idea, a great point. I think the reason I say entrepreneurs or a startup team is because, number one, it's very lonely being one. Being, being an entrepreneur itself is a very lonely journey, at least in the beginning in the startup, in the starting phase. Uh, and as you go out to raise money, oftentimes you'll be faced with challenges, people who don't believe in you, uh, people who kind of say negative things or try to dissuade you, even including your friends, family, and, and, and loved ones. And so, if you are the only one, and if you're single, I think it can be very, very difficult, and oftentimes discouraging, and oftentimes, um, torturous, that journey. But having a partner, I think, really helps, uh, to run ideas by, to make sure that you guys are teed up, and you run things through, and you, and you kind of challenge each other. Uh, the second reason, I think, is, I think two is always better than one. But I think at about three or four, it becomes a crowd. Um, and, and finally, I think, you know, it's, it's very difficult to find one person who is good at everything, or multiple things. You may have one particular skill set that you're really good at. Uh, so to compliment yourself, to bring in another guy whom you've convinced of the idea, who is also as passionate, and brings in a complimentary set, I think increases the odds of success.

AI assessment note: “to bring in another guy whom you've convinced of the idea... increases the odds”

Q Fantastic. Thank you. And is there anything a founder can do before a pitch to put themselves in a good position to attain funding, uh, Be it researching you as an individual VC and knowing your background, or knowing the sector excessively well, or is there any in particular?

A Yeah, I think, uh, you know, it's all comes into, uh, comes in under the, um, subject of preparedness, right, or preparation. I think entrepreneurs should prepare. Um, if you come to an investor who, let's say, has been making only consumer internet investments for the last four, five, six, seven, 10 years, and you come to them with an enterprise big data idea, I think very likely you're going to be educating that investor versus getting his buy-in or having an intelligent conversation. And so it's important to understand who that investor is, what they've been investing is, what their experience has been, and what their successes have been, and what their failures, because oftentimes we are human beings. We do get jaded, and we do get experienced and influenced by our failures. And if there's something in the past that I have done, I had invested in, did not work out, that's going to leave a bias on it. It doesn't, you know, no matter what I say, it does impact my thinking. And if so, if it is in a certain area that I had invested in, let's say the company didn't work out, And if you come with a similar business plan, or a business in the same, same sector, you should be prepared to understand why, and at least engage in a conversation, why you'd be different, or why this is different. Um, and so I think it is, it all comes under preparation, and the more prepared you are, the…

AI assessment note: “it's important to understand who that investor is, what they've been investing is”

Q Absolutely, that's fascinating. And, and honing in a little on your own investment strategy, when it comes to investing in a startup, are there one or two must-haves for you for, to invest in a startup?

A Yeah. Um, you know, it's, it's, it may sound repetitive, or it may sound almost funny, but I think the truth of venture capital is that it's really all about the people. Uh, unlike growth stage investing or private equity investing where there is a business, there are financial analysis to be done, there are stuff to be looked at. When it comes to startups and innovation and really disrupting existing markets, it's, it really boils down to the passion of the person, the passion of the team, and the passion of the people starting the company. And so in my, in my experience, you know, the must have is the hunger and the, and the excitement and the passion in the, in the people. And it's, It's tough to evaluate, and that's why I think we oftentimes get it wrong, but when we get it right, Uh, the real guys who are going to innovate and disrupt the world are the ones who truly believe and maniacally believe in what they're trying to do. And in some ways, you know, in a funny way, I think about it as these are technology jihadists, if you know what I mean.

AI assessment note: “the must have is the hunger and the, and the excitement and the passion”

Q And how do you evaluate whether a founder does have that passion and that drive? Is it, is it just in instinct? It's there from the offset or, or do you have to experience it over time over a few meetings?

A I think, uh, you know, over the last 15 years, I think I've built my own tool set as to how I can figure it out and how I try to figure it out. Uh, obviously it's not a science, it's an art, and that's why I think venture capital as a business, as an industry, is an, is a, is a, is an apprenticeship business, so you've got to acquire those skills and that talent over time. But I think it all comes across multiple ways in terms of, uh, the entrepreneurs or the founders really presenting when they present the amount of work they've done. Uh, their knowledge of the subject. Oftentimes they are, they are trying to disrupt something that they really don't have deep operating or long experience in, but they have the knowledge. They've acquired the knowledge. They, they firmly believe what's wrong. They've experienced something. They've experienced the difficulty because of which they are drawn towards a new business idea, and they're gonna solve the problem. Uh, they, they, they almost talk about it in an emotional way. It's personal in lots of ways. The, the, the pain point is personal. The problem is personal. And that's what drives them towards this, uh, uh, kind of like the call, if you will, to disrupt and to innovate. So I think there isn't, it isn't a sign. So I can't say, hey, you know, here are the, here are the three or four things you look for. But I think you, it's almost…

AI assessment note: “it's almost like we know it when we see it”

Q Thank you so much for sharing that with us. And are there any potentially uncomfortable questions that Founders should be asking VCs before accepting investment in their company, potentially that, that, uh, uneasy to answer. Do you, um, so, you know, how many boards do you sit on, or do you have the time for us, or are there any of those types of questions that you would recommend asking?

A Yeah, I mean, that's a very good question, Harry. I think, you know, entrepreneurs, before they take money from someone, should ask as many questions and do as, and should do as much diligence as the investors do on the entrepreneurs. It's a bi-directional relationship. It should never be unidirectional. When I invest, I actually insist and emphasize upon my entrepreneurs and the CEOs to go out and talk to as many people that I have interacted with in the past. So they have a sense of who I am. And how I operate and how I'll deal with difficulties and difficult situations and good times and bad times. Um, so I think entrepreneurs should take that very seriously and should, uh, ask as many, if not more questions, because this is, you know, uh, getting into this investor entrepreneur relationship is like a marriage. It's not dating.

AI assessment note: “go out and talk to as many people that I have interacted with”

Q Thank you so much for sharing that with us. And are there any potentially uncomfortable questions that Founders should be asking VCs before accepting investment in their company, potentially that, that, uh, uneasy to answer. Do you, um, so, you know, how many boards do you sit on, or do you have the time for us, or are there any of those types of questions that you would recommend asking?

A Yeah, I mean, that's a very good question, Harry. I think, you know, entrepreneurs, before they take money from someone, should ask as many questions and do as, and should do as much diligence as the investors do on the entrepreneurs. It's a bi-directional relationship. It should never be unidirectional. When I invest, I actually insist and emphasize upon my entrepreneurs and the CEOs to go out and talk to as many people that I have interacted with in the past. So they have a sense of who I am. And how I operate and how I'll deal with difficulties and difficult situations and good times and bad times. Um, so I think entrepreneurs should take that very seriously and should, uh, ask as many, if not more questions, because this is, you know, uh, getting into this investor entrepreneur relationship is like a marriage. It's not dating.

AI assessment note: “talk to as many people that I have interacted with in the past”