Opinion
Founders cannot build a viable SaaS business selling only to India
“See in India, unfortunately you can't really build a SaaS business out of India, you know, and it is just our, you know, the Indian, the way Indian enterprises or the small businesses think I don't think they're ready yet to really embrace SaaS in a big way.”
Disclosure
Ghorpade: All 25+ Exfinity Portfolio Companies Focus on Indo-US Corridor
“All of them because enterprise tech by nature, and we always say that we work in the Indo-US corridor because companies can actually test their products in India. They can actually achieve scale in India. They can maybe learn from Indian corporations. They can…”
Insight
Big tech enterprise sales experience does not easily translate to startups
“Selling a new age product is, you know, you might have done a lot of selling for companies like, say for example, Infosys or Oracle or whatever, that doesn't mean that you can sell a startup product because at the end of the day, you know you have the backing …”
Opinion
Ghorpade: Exfinity was likely India's first dedicated B2B enterprise tech fund
“I think Xfinity was probably the first, you know, true blue focused B to B tech fund, you know, so there were many, many funds, which did B to B investments or enterprise tech investments, but it formed a small portion of their overall corpus. The focus was la…”
Insight
Ghorpade: All SaaS companies essentially operate as workflow management tools
“All SaaS companies really, essentially what they do is workflow management. So their understanding of the client workflows, their pain points has to be of a very, very high order. And unless you really achieve that, and unless you appreciate the issues of that…”
Assertion Supported
India has 10,000 SaaS companies compared to 50,000-70,000 globally
“Today, if you look at the SaaS space, right, it is there are some 10,000 SaaS companies in India and maybe 50,070 thousand companies globally.”
Disclosure
Ghorpade admits Exfinity does not add much value beyond $10M ARR
“Beyond ten million is not something that we add a lot of value to be very candid. Yes, we can provide some inputs on strategy, et cetera, because we know the company, but I think I would imagine that after that we have seen growth funds providing a lot of valu…”
Insight
Ghorpade: Undercapitalized startups flounder in the US due to frugal GTM spend
“So the go to market and teams are an area in us where many startups actually flounder. And the problem becomes acute because at that time, you know, you may not have raised too much of capital and us is that way in our market where you need capital. So many ti…”
Insight
Global expansion is the biggest bottleneck between $1M and $10M ARR
“So it is a completely different mindset that is needed when you actually globalize. And that is in my view, the single biggest challenge that companies face between one to 10.”
Insight
Ghorpade: Southeast Asia is a key transitional market for Indian SaaS
“And we believe that the Southeast Asian market is a good transition market between India and the U S because one, it is a different market than your home market.”
Insight
Testing a US SaaS GTM strategy costs $4M to $5M
“I would still imagine that a proper US strategy for a couple of years, if you have to really test and execute, would cost you anywhere between four to five million dollars.”
Prediction Not checkable as stated
Ghorpade: Most enterprise software exits will be trade sales, not IPOs
“And we believe that in most of the cases, while there will be, of course, some IPOs that will happen, but there'll be few and far between. Many companies will find its exit from a trade sale.”
Disclosure
Exfinity chose enterprise tech over B2C due to founding partners' expertise
“20 13 was a time when, you know, we were just discussing with Mohandas Pai and Bala, both, you know, ex CFOs and members of the board at Infosys. And we said that, look, we should really look at the VC space. And we said, we didn't know, you know, we thought t…”
Assertion Supported
Ghorpade: Deepak Gaisas co-founded i-flex, arguably India's first product company
“Deepak Gaisas who probably, you know, Arguably founded, co-founded the first product company in India called iFlex, which is a core banking.”
Disclosure
Ghorpade details Exfinity Fund 1 and Fund 2 performance and sizing
“So first fund was 125 crores. We funded nine companies out of it. And we wrote down two of them. We have we launched a second fund, which in, in 2016, this was a 300 crore fund. Where we funded about 19 companies.”
Disclosure
Exfinity raises 500 crore INR third fund with late 2020 close
“And now we are on a third fund where which we are raising you know, amounting to 500 crores. We've done a first close already, and we are looking at a second close by end of December.”
Disclosure
Exfinity to target 20-22 companies, shifting to Pre-Series A and Series A in Fund 3
“And in the third fund, we anticipate creating a portfolio of about 20 to 22 companies. In the previous funds, you know, because of the fund size and all, we actually also did seed seed plus investments. In the third fund, given that the corpus is a little larg…”
Disclosure
Exfinity backed Mad Street Den for its pragmatic enterprise AI vision
“One is that we actually both Ashwini and Anand have been really stellar founders. I think what we liked about them is the fact that how they were looking at the application of AI, you know, so AI per se, a lot of funds do it. And every second company that you …”
Disclosure
Exfinity has four portfolio companies above $10M ARR
“I think now on the growth stage, if you, if I were to take your you know, sort of benchmarks, whatever you said, I think we have about now four companies, about ten million ARR. And between one to 10, I think we'll have a bunch of them. Actually our maximum po…”
Assertion Partly supported
India spends 14% of its GDP on logistics versus 6-7% elsewhere
“Logistics in India has been, for example, you know, a very, very hot space in the sense that, you know, we spend close to about 14% of our GDP on, on logistics costs. The developed countries spend about six to seven percent.”
Insight
SaaS startups at $2M-$4M ARR typically average $50k-$60k ACVs
“When companies are between say a couple of million dollars, two, three, four million dollars of ARR, you know, their average account sizes would be anywhere about 50,060 thousand dollars. But as they grow, start growing beyond that, then we see the hundred K d…”
Assertion Not checkable as stated
Locus regularly hits $100k ACVs and has accounts exceeding $1M
“They are able to hit a hundred K ACVs quite regularly. In fact, they have, One account, which is a very large account, which is now a million dollar account. There are two accounts, actually. One is very close to the threshold of a million dollars. Other one h…”
Assertion Not checkable as stated
Unilever India sponsored Locus's expansion into multiple Southeast Asian countries
“Locus started with Unilever India. And depending on the work that they have done now, Unilever India has become a champion and they are taking them to various you know, Southeast Asian countries, at least six or seven of them and they are sponsoring.”
