The Exchanges

Q And which kind of startups are you looking to invest in?

A Yeah. So I think, um, Obviously, primarily consumer brands. Um, the investments, look, you know, this is always going to be a spectrum, but if you ask me for a sweet spot, for a desired sweet spot, I would say that, um, one, um, we would like to, we would like to look at companies which are raising a series A or an early series B. Uh, we like a, we like an empty canvas. We like a space where the, the company has built a product. There is product Product market fit reasonably established. And the next lever for growth for this company is marketing. That's the point of time that we would like to come in. That's the point of time where we believe our expertise is of maximum value to the entrepreneur and the management team. So that's the sweet spot. Apart from this, we will look for, um, our thesis, so to speak, we, uh, is we will look for companies, uh, which use technology in one or more of the following ways. Um, to build a superior product because they have access to data, B, and or B, um, using technology to access the consumer better, and or using technology to build a brand online. So I feel that one or more of these factors are required in order to accelerate the growth of company. We would be reluctant to invest in a pure play, uh, retail company which does not employ technology in any way, just as an example. So that's gonna, that's our desired sweet spot. That's where w…

AI assessment note: “Obviously, primarily consumer brands... raising a series A or an early series B.”

Q So Spring is not a pure marketing consultancy company. It's not a pure VC. Why this a hybrid model?

A I think hybrid model, and I, I, I, you know, as I, as I talk about this model more, I feel that this is something that will happen that we will see a lot more of, which is, I mean, there are the traditional VCs and I think they play a very important role. Um, they are usually the first investors. They identify these companies and they bring a certain skill set that we do not possess. Um, you know, and that's what, that's not what we see as our primary role. We have a specific expertise to offer, which is in the area of building brands, which is in the area of providing marketing expertise, and we want to, we wanted to keep our work restricted to our area. We are aware of our strengths and weaknesses. Um, I wouldn't say weakness, I would almost say lack of, we are aware of our capabilities and lack of capabilities. Um, secondly, by partnering with VCs, we felt that we will have access Um, to, um, to a pool of startups where we can actually work with those companies where our marketing intervention will offer the maximum value. And to answer your specific question on why marketing capital, I mean, marketing capital because we strongly believe, and this is really the core philosophy behind Spring, we strongly believe that a marketing intervention at the right point of time unlocks significant equity value. And now we could have done this for fees in the pure consulting model. Um, …

AI assessment note: “a capital plus expertise model allows us to capture that value.”

Q So, uh, spring marketing essentially replaces a CMO in a startup?

A Uh, no, it doesn't. I personally think of it as, um, no, you can't do without the marketing team, to be honest. Uh, I think we are humble enough to realize that, you know, we can't do that. What we do actually is, um, if we come in at the right point of Like I said, if we come in at a point of time when the marketing and the brand journey of this company is being charted, we have the ability to help think through some of the core elements of the brand, which is starting from the consumer proposition. I feel that that's the most useful in many cases when we come in early, when we come in at a series A, um, together with the founder. So Spring insists that the founder has to be a part of the exercise. I mean, and this is no disrespect to marketing teams. We work, all the companies that we work with, we work with the marketing teams, but we also insist that the founder has to be in the room. And that's because at that first level, the main job that Spring wants to do is to help craft the consumer proposition. If we do it together, if we do it right, what tends to happen is that consumer proposition almost becomes a philosophy for the company to follow for the next few years. And like I always say, point at that, it changes, it's evolving, it's dynamic, but it gives the company a roadmap. It says, this is what the product is, this is who my consumer is, and this is the bridge that …

AI assessment note: “Uh, no, it doesn't. I personally think of it as, um, no”

Q So we seem to have entered a new phase of Indian startup ecosystem. What has changed? What has changed in terms of building brand faster and much less capital?

A I don't know about the much less capital, but there's a lot of capital being spent. Um, maybe not all of it is going towards building brands, but there is a lot of money being spent. Um, but yes, I think there is a new phase of, um, which is why consumer investing in India has taken off so well in the last few years. There is a lot of interest in consumer in India. We are seeing it as we are lucky beneficiaries of this point of time. Uh, there is huge amount of interest, both from within India and outside India and building brands. Uh, there are some very accomplished investors who are looking closely at this, at this space. Um, there are brands that are emerging out of India, and I think that's only right. I mean, it's, it's seen, it always seemed wrong that the Google of India should be Google, and the Amazon of India should be Amazon. I mean, always feel, it always felt wrong. Um, I think the breakfast product of India can be Indian now. The chai of India can be Indian. The coffee of India can be, if it's not already Indian. The soap of India can be Indian. Um, and I think it's evolution. Um, some of it is cultural. Uh, my good friend VT Bharadwaj, the partner at A-Ninety-One, uh, he has a theory about how, um, and you should talk to him, but he has a theory about how consumer brands are also getting built out about cultural change. I will, I won't steal from him, uh, but I …

AI assessment note: “I don't know about the much less capital, but there's a lot of capital being spent.”

Q So you entered into a stage when a series A VC has already Written a check. What advantage does it give you with a traditional VC on a cap table? Because you will own a significant less percentage of the company.

A I think, um, we don't see it that way. We see it as partnering with a VC. Um, sometimes our, our entry into the company may happen post the VC. Um, sometimes it may happen along with the VC. Uh, but we see our role as working with a few select VCs, and what I'm very happy about is we already have a bunch of the top VCs who are, um, who are interested to partner with us, who have already started making introductions to companies in their portfolio. Frankly, many of the companies that we work with today, um, at Spring, um, are actually introductions made by VC firms. So to some extent, the, the proof of concept of that is, I think, already playing out. Um, so we look at it as partnering with VCs and offering marketing expertise to a founder at a time when, you know, this marketing expertise can significantly get the founder on the right track towards building the brand. Look, make no mistake. This is a very long journey. Um, it's not as if our coming in, you know, is going to work like magic. Some situations I hope it works like magic, but it's not going to always happen. I think it's a long journey. Um, but we, I believe that we will help Ask the right questions. I believe that we will help the founder make the right design choices on marketing. Um, and hopefully those early design choices will, you know, save a lot of money over a period of time, um, set the brand on the right …

AI assessment note: “who have already started making introductions to companies in their portfolio.”

Q So three of the companies you are already working with, you work with Baiju's and you brought in Shahrukh Khan, you worked with Epigamia, you brought in Deepika Padukone, and HealthCart, the campaign is very popular. Why no celebrating HealthCart?

A So I think, um, I would hate to be, uh, I would hate for Spring to be known as a Company that only works with celebrities. That's not the intention. Um, look, every situation is different. Every situation is unique. Um, and it's always a joint decision. It's always a joint decision between spring and the founder and the marketing team. Um, and it's not, and it's always a decision that's taken at a point of time. I mean, point of time is one of my favorite phrases. I use it a lot. Uh, what's valid today is not valid tomorrow and it's not valid yesterday. If you had met me a year back, um, I would have given you a different answer. If you meet me a year later, I'm going to give you a different answer. I know this sounds a little shocking. You know, people think that you should retain your, I mean, that philosophies remain constant, but you have to evolve with times. You have to be dynamic. And I think Baiju, for example, we, uh, Arun and I worked with Baiju from our earlier organizations for a couple of years before spring. Um, and there was no Shah Rukh Khan around the table. Um, I think if you remember the launch campaign of Baiju's, which was insanely successful, then there was a celebrity. He did not need a celebrity at that point of time. A year later, we had two further campaigns, and Baiju continued to grow. If you chart the path of Baiju, if I remember right, um, over the…

AI assessment note: “I would hate for Spring to be known as a Company that only works with celebrities.”