India can be a laboratory for FinTech Startups: Ninad Karpe
FinTechs & Startups need the right ecosystem to grow and flourish; often founders face challenges in early stage to get the right support system. Instead of focusing on product and market they end up wasting time on valuations and prices. 100X.VC a new entrant in the startup-ecosystem is here to provide the right early stage support which startups & founders need.
In a conversation with Ninad Karpe, Partner at 100X.VC, he shares what’s their strategy ahead to fund and support 100 startups & FinTechs in the next one year. Edited Excerpts;
Q. What’s the strategy at 100X.VC?
The startup ecosystem in India is at a nascent stage and there’s an immense potential and room for them to grow. At the same time, there’s a lot of gap when it comes to getting support at the early stage or seed stage. There’s no dearth of ideas but there’s dearth of support. At 100X.VC we’re building that ecosystem and filling the gap of early stage support for startups & FinTechs.
Q. How will you help start-ups?
We’re going to fund 100 startups in a year through iSAFE notes, which is unique to our model. iSAFE means Simple Agreement for Future Equity. Under iSAFE notes stake will come during the pricing round while initially we would want to keep it simple for startups and get burdened by too much documentations, pricing and valuations, etc. We aim to fund 100 sector agnostic startups in the next one year.
Q. What kind of start-ups have approached 100X.VC?
We’re surprised by the response we received. We received more than 960 applications since we announced 100X.VC. We had decided to select 25 start-ups in 4 batches. Bangalore, Mumbai & Delhi were the major hubs from where we received applications. An interesting insight from these applications comes out that approx 40% startups were from tier-2 cities.
Q. Scope in FInTech startups?
India can be a laboratory for FinTech startups. The kind of ideas that come out both in B2C and B2B space are really interesting and I believe FinTechs can ride the overall growth in startup ecosystem. Honestly speaking, we are looking for moonshots & moonshot ideas, looking for crazy people (not literally) with positive attitude.
Q. How will the valuations and pricing works?
In iSAFE notes, pricing does not picture in since it is an early stage instrument. We’re going to invest in two – three levels between Rs.25L & Rs.1cr. Equity will come into the picture during the pricing round. In the early stage ecosystem mortality is very high, our aim is to bring it down. We have to note that startups don’t fail because the idea is poor or cannot work out. They fail due to poor execution and we’re here to help startups work on their execution strategy and bring right mentorship on table along with pricing and valuations at a right time and stage but not at the early stage.
Q. How would you ensure start-ups don’t close?
What we would do is ensure that founders love market than their products, often what happens is founder end up focusing too much on product and neglect whether the product is market fit or addressable to certain scale. Founder have to ensure balance between product and addressable market opportunities. In the next stage we’ll be providing them the bridge for next series of investments.