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Nov 23, 2022
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The investment opportunity will never be perfect, especially at early stages

-Ankit Kedia, Founder, Capital-A (Manjushree Capital Advisors)

 

Team 100X interviewed some of the top investors across the globe about their venture investing journeys, startups, and India. Here, Ankit Kedia, Founder, Capital-A (Manjushree Capital Advisors) shares his responses.


Q1. What is your motivation to be in the venture investing business

One of the most gratifying reasons why I decided to become a VC is to create an impact both for our founders as well as the founder's audience. Another reason why we got into early stage investing is to leverage on the start-up ecosystem energy in India, given there is so much entrepreneurship and government push for the same, it is perhaps the best time to invest in the story of India !

 

Q2. Describe your workday and leisure day, how does it look like

My workday is a combination of internal meetings with my team to discuss new investment opportunities, performance of existing portfolios and what should be done to tighten our investment thesis and understanding of various sectors. Also given that I’m a partner in the family office, a lot of our investment decisions in the public market also gets reviewed. We tried to make our workdays not a typical 9 to 5 job, but as enjoyable as possible. As a VC, its very important also to make sure there are enough pauses one needs to take in the middle of investing and evaluation for which I like to spend time with my guitar and with my children. An ideal “switch-off day” will be reflecting and spending time with myself at our farmhouse, where I revisit both my personal and work goals.

 

Q3. What is your view on the future of India as a market

India has a very resilient landscape especially at a macro level, while there are a few moving pieces in terms of regulatory policies around emerging sectors such as electric vehicles and Fintech, we are optimistic that the overall fundamentals are still quite strong. There may be constant reminders to investors to check on “over exposure”, however the basics of investing do not change and we will continue to see large investments around various sectors and stages.

 

Q4. Help describe your investment thesis and ideas you would like to back

One of the key reasons why early stage funds like us focus on building a thesis just to ensure our belief in the founder, the sector they are operating, and their plans are all aligned to ensure we stay with them through the entire lifecycle of the investment. Some of the preferred themes at Capital-A include Fintech, tech enabled start-up, climate tech including EV and mobility. In each of these sectors, there are white spaces where entrepreneurs are actively building meaningful businesses. But the ones who can completely stand out with a clear differentiation plan, we will back them. We look for tech angles in most of the investment that we do as we believe that it is an important part of our lifestyle. Any revolutionary idea is absolutely welcome as well, however, we go in as co-investors along with a large fund in such cases. Even in the EV space we believe that our cheque size of half a million is not sufficient for entrepreneurs building capital intensive businesses, however we continue to evaluate opportunities in the ecosystem play, similarly given the vastness of the Fintech universe, we selectively look at lending opportunities, wealth tech, embedded credit, EV financing and similar subsectors. Given the increased focus on climate tech and ESG, we are quite bullish on investing in sectors that are building for the long haul, in the area of sustainable packaging, clean energy, air and water purification and its ancillary spaces.

 

Q5. What are your 5 key learnings from your experience as a venture investor

          Here are my top 5 learnings as a venture investor

  1. Entrepreneurs are building business, “not deals”- give them the due credit.

  2. As an investor, we need to clearly identify our role with the founder during an investment. Whether the investment is merely financial capital or an active involvement in the founder’s vision. Smart founders do not need to be told what to do.
  3. The investment opportunity will never be perfect especially at early stages. Very important to establish clarity during evaluation on what is a go and what is a no-go !
  4. Both the founders and investors' time are super valuable – Do not waste each other’s time.
  5. It is of supreme importance that the entire team of a VC fund is aligned to the bigger vision and stays absolutely connected with the activities in preferred sectors, macros of the industry and a blueprint of the future.

 

Q6.

Mention top 5 consumer/industry/technology trends in India and globally

  1. As the world is rapidly adapting digital means of consuming different products and services – technology will be a key enabler for any industry whether it is industry 4.0 in manufacturing or an app which helps you to call a hairstylist at home.
  2. As India’s population gets younger by the date – the market will accordingly demand speed, agility, innovation, and a youth centric approach towards the economy.
  3. In the quest for building large business and returns to stakeholders, a sharp focus on climate tech will be the order of the day. Consumer behaviour will focus on sustainability and net carbon emissions to make purchase decisions.
  4. With the introduction of 5G services, each year there will be an exponential increase in customers joining the smartphone revolution and consuming data like never before! Sectors like ecommerce, creator economy, online learning and entertainment will be one of the largest beneficiaries with the 5G boost.
  5. Industries operating in the deep tech spaces like artificial intelligence and machine learning will continue to make templatized jobs far more simpler and human beings will have to calibrate their contribution as an additional layer on top of the obvious.

 

Q7. Top 5 advice you would give to startup founder

           My advice to start up founders would be as follows.

  1. The world of start-ups is very glamorous from the outside and before starting up, please establish clarity if you really want to be a part of this ecosystem. You will constantly be surrounded by an overwhelming expectation of society, your family and all other well-wishers who want to see you succeed in life. Please have your individual definition of success and do not give in to FOMO.
  2. When starting up consider investing your own capital into the business until the POC stage – This becomes highly probable to attract both Angel and VC capital.
  3. Irrespective of stage, your investors are your biggest mascots – leverage their network to meet new people, industry experts and given that there will be excessive people giving you life and work advice, learn to absorb the ones that fits the bill and discard the ones that you don’t believe in.
  4. “Brand up before you start up” – This is by far one of the most neglected areas by an entrepreneur which needs urgent attention. Creating a brand identity for yourself and for your startup is extremely important including fundamentals like a website, collaterals, and an active LinkedIn profile with consistent engagement. The idea is to build a brand which suits your individual style and your start-up’s identity; for example your LinkedIn profile speaks volumes about you as an individual – make sure it competes in all aspects and it speaks about your start-up mission very clearly.
  5. With the increasing amount of capital in the market there will be enough opportunities for start-up founders to raise funds, however the lens to make an investment decision has evolved and will not be the mindless deployment of capital that we have seen in 2020-2021. Please ensure that your start-up idea is meaningful, sustainable and clearly establishes win-win for both you as a founder and the investors.

 

Q8.

How do you support your portfolio companies

          We do various activities to support our portfolio companies given the fundamental premise of Capital-A based on the 3 pillars.

  1. Engagement Capital
  2. Network Capital
  3. EQ capital. Given my extensive operating experience as well as being at the helm of affairs at our family office, we constantly unlock networking opportunities for our founders as well as actively engage with them whenever they need us. Given our active interest in a diverse sectors like Fintech and EV, we constantly try to create opportunities for cross-selling and cross-pollination within our portfolio; for example we recently stitched a deal between Charge-up (Battery Swapping as a Service) along with Jiraaf (an online wealth tech platform) to raise debt for charge up  which was subscribed within 12 minutes of its listing on Jiraaf platform. The result is a continued dialogue between both parties to work on a long term. In addition to all these, our solid team of analysts and portfolio managers constantly engages with their respective portfolio companies to enable their business success as well as keep their morale high. We recently organised Capital Connect – A mega event to bring together every ecosystem player including founders, PE/VC funds, bankers, financial advisors, marketing agencies, tech developers, under one roof attended by marquee names to provide exposure and networking opportunity for our portfolio. We also launched a coffee table book of our entire portfolio which was digitally distributed to over 1000 stake holders in the industry leverage on the good work that they are doing.

 

Q9.

Which of your portfolio company you are very excited about and why

During investment we clearly know which ones will break out early and which one will mature with time and market circumstances. While we are bullish about our entire portfolios, we see early offshoots in our portfolio including ChargeUp, Oorja and Matchlog. Amongst the Fintechs, one of the fastest growing wealth tech platforms in the country, Jiraaf is clearly shattering all the records within one year of its existence. Another Climate tech investment in a company called Matchlog is on their path to establish a strong foothold in freight optimisation and massive reduction in carbon emissions with their unique technology built in partnership with various shipping lines. These are some of the first few investments that we have done, and we are expecting similar outcomes from the rest of our portfolios.

 

Q10.

When you started your career what were your ambitions

When I started as an operator in our family business of rigid plastic packaging, my ambition was to establish Manjushree Technopack Ltd as a pioneer in the field of packaging with a strong innovation bend and agility. Prior to founding Capital-A, I have learned that having your own definition of ambition and success is supremely important. In my current role as the general partner of Capital-A, I am here to make an impact by investing in meaningful businesses as well as build for a financial outcome as a result of the impact.

 

Q11. What inspires you in life and what keeps you awake at night

I am extremely inspired by my father and the value systems of our family which I tried to inculcate both in my personal and professional avatars. It has always been my core belief that while every business is about making money now and in the future, it can be done with integrity, a good story and a global outlook. As an investor the one thing that constantly keeps me awake at night is to ensure I meet with great founders, entrepreneurs and we don’t miss out on meaningful conversations. Although we have quickly learned never to give into FOMO and signal investing, we are also quite competitive to ensure we don’t lose out on the chance to engage with founders.

 

Q12.

Books or Blogs you would recommend entrepreneurs

I would highly recommend that founders constantly build a habit to read a few books especially when they are starting up. The ones that I will highly recommend is Loonshots by Safi Bahcall, Peter Thiel's The Power of One and biographies/autobiographies of various startup founders. Amongst the podcast, I would highly recommend the Desi VC podcast by Akash Bhat which gives deep insights into the investor mindsets and the a16z podcast by Andreessen Horowitz.  In addition to this, there are some great shows on OTT including biographical descriptions of founders like Adam Neumann, Travis Kalanick, Elizabeth homes of WeWork, Uber and Theranos respectively.


 

About Ankit : 

Ankit Kedia is an award-winning Indian Entrepreneur, best known as the former Promoter Director at Manjushree Technopack Limited, India’s largest rigid plastic manufacturing organisation with revenues of ~$500 million. Along with other members of the family Ankit helped Manjushree reach a leadership position in the plastic packaging industry and has helped build relationships with blue chip clients including Reckitt Benckiser, Philips, Nivea, Unilever, Coca-Cola, and other home-grown clients across the country. In 2018, Manjushree sold controlling stakes to Advent International - one of the most well-respected private equity investors in the world, at a record valuation in the packaging industry. Having grown up in an enterprising family of entrepreneurs, Ankit graduated from Western Michigan University with a business degree in Food marketing and then went onto complete his post-graduation from the prestigious SP Jain institute of Management and Research, Mumbai. After having built a large portfolio of angel investments into early stage startups, he founded Capital-A in 2021, an INR200cr (~$25 Million) early stage venture capital fund to invest in meaningful startups and entrepreneurs. The fund has a strong thesis into investing in EV, Mobility, Fintech, gaming and other tech enabled businesses.


 

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