Today I have with me Amit Somani, managing partner Prime Ventures. Welcome Amit, to the podcast. Thanks, Siddharth. A pleasure to be on the podcast. Amit, we would love to know more about your journey. Sure, Sidharth. So I grew up in India went to IIT Bhu, then went abroad mostly to Silicon Valley was there for about 14 years came back to India in 2007 when I thought that India was going to be a really tall building and I was getting in on the ground floor now 11 years later I still feel like India is gonna be a really tall building.. but hopefully, we now come to the second floor. So now I've been in India for about 10 11 years started my career in India with Google India, I was heading product there, then moved to MakeMyTrip was heading product there we had the good fortune to go IPO on NASDAQ in 2010, and then we'll talk a little bit about Prime, so that's been a quick journey. So tech product background leading to accidental VC. So how did Prime happen for you? Like I said, I was an accidental VC and I have this belief that every 10 years people should take a year off on a self-imposed sabbatical or jobbatical and take the time for self-discovery
take the time to find yourself take the time to learn about what else is happening. So after I left to MakeMyTrip in the summer of 2014, I was on my second sabbatical in my life. And when I travel to China, I was helping mentoring startups, I was doing other things and then Sunjay and Shripathi my partners here at Prime. They were looking for a third partner. So they reached out to me and they obviously started with not saying hey come join us, it was saying hey, can you mentor this company? Can you be in the board of that company? Can you be an advisor here and one thing led to another and finally they said hey, we'd love it you would explore joining us full time at which point I told them look I have absolutely zero background in investing. I'd done a few angel investment about 4 or 5 and they say then you fit right in right like we also have really no background in investing although they've been investing for several years. So that's how I got into Prime Ventures. How was Prime started? We would like to know the background story. How did they came together? And what was the purpose of starting Prime? Absolutely. So Sanjay, Shreepati and Bala who were the three co-founders of Prime Ventures and used to be called Angel Prime actually before it was called Prime Ventures and Raj Mashruwala who is our partner Emeritus based in Paulo Alto in California all four of them were working for Nandan Nilekani for the Adhaar project, so they spent two years pro bono-working for the government helping build out Aadhar.
That's where they all met, as Aadhaar was wrapping up in the sense that Nandan was you know had political inclinations at the time and they had already reached some fifty a hundred million users they were figuring out what to do next because they're all serial entrepreneurs have had successful and failed stints Silicon Valley, India, everybody has lived and worked abroad at least 10-15 years. So then they said hey look we want to bring the professionalism of Silicon Valley to India, but we don't want to do this VC thing. VC thing is a little bit odd. So why don't we just help startups? And so they raised a very small, you can call it a fund now, but it used to be called Angel Prime like a two million dollar fund to just work with two-three companies and just help them and you know, give them a little bit of capital that's started going really well to those companies are one is Easytap which is still around and doing very well one of the earliest mobile posh companies in India. The other one was zip dial which exited to Twitter four years ago and then they said hey, look this looks for real like I think maybe this VC thing is not so bad. We can work with early-stage startups, we can work closely with them and we can bring capital to bare. So then they actually went and raised their first formal institutional fund which was a little under 10 million dollars, I think that was probably in 2013 perhaps. And how does the fund look today? Yeah, so fund two we raised, actually I joined to help raise the second fund
So I joined in January of 2015 and we then went on to raise by July about a little under 50 million dollar fund, which is now fully committed. And so that was fund two, and last year we announced our fund 3 which we raised about 72 million dollars about 500 crores INR that was announced I think last March so March of 2018. What's your purpose in life Amit? Wow!!, that's a pretty profound question. So there are, so I'm a big believer of and a big reader of all kinds of spirituality text from the Bhagavad-gita to stuff about Buddhism and so forth. So two things that are increasingly as I'm getting older, I guess getting more mature maybe hopefully a little wiser as well, one is just being able to capture your own mind, right? So, you know Buddha has this amazing quote which says, you know, it's not about capturing other people or objects or whatever is like can do you have control over yourself? Do you have ability to control your own mind and so forth. So that is one really big belief and the second one, which is more to your question about purpose of life is really how do you help others win? There's a very famous sales leader and trainer is no more now in the U.S. called Zig Ziglar, so he has this court saying if you make enough other people win in life, you're going to win in life. Right? So your mission in life should be to make enough other people win and both at a personal level and now thanks to the platform at Prime Ventures. The mission is really to help people around me win. So how many companies has Prime Ventures has invested till now? We've invested in about 23 companies life to date since the beginning of time across these three, three-and-a-half funds and there's a lot in Fintech, there's a lot in SAS, anything that's tech product driven we look at so we're agnostic to sector so we've invested in logistics companies we've invested in health care and Ed Tech but really Fintech and SAS or two big focus areas for the fund. As a early-stage VC investor, which markets have been a win for you in the last five years where you had a predefined thesis? Yeah, like I said Fintech and SAS of the real big ones. In fact, my partner Sanjay Swami he is kind of known as Mr Fintech from before it was called Fintech, he was one of the early founders of a company called M-check which actually didn't do so well, but they'd gone and raised 15 20 million, they were doing mobile payments, you know well before PayTM and MobiKwik and the current cohort of the large Fintech payment wallet companies, right so Fintech was always a conscious thesis for prime also because a lot of the work that they did at Aadhar, Financial Services inclusion, that was really a big thing. So even today we try to look at almost everything in Fintech if we can, ask SAS is I would say I mean we've invested in SAS for the last five six years, but really in the last couple of years, we've become very very bullish and big on building global product companies out of India. and leveraging this digital marketing provice and not just the engineering and product provice Right? So SAS is another conscious kind of bed. I think other things to be very candid are opportunistic, right? So if we find great entrepreneurs big market, some differentiation, one of the big things about Prime is we look for what's the 10x differentiation that you have compared to anybody else and it could be the product, it could be go to market, it could be distribution, strategy it could be some unfair insight on the market. So we are open to those kinds of place beyond Fintech and SAS as well. Out of those 23 companies the markets which you invested in which markets didn't work out for you? Right? Siddharth so we'd be pretty fortunate in a sense invested in 23 companies, one didn't work out and that was in the early days of 2012-2013 by enlarge all the other companies have done well some of course have done exceedingly well, some are profitable, some are break even, supposed to kind of hanging in there but really you haven't had that much of classic, you know shut down kind of thing, one like I said Zipdial exited to Twitter for years ago, you know another one, you know, your company Shiros acquired but by and large it is been a pretty good journey. In terms of you know in terms of thesis we do have a fair share of anti portfolio companies, right which is companies that we could have invested in but we didn't you know, too that we often talk about our TaxiForSure is we talk about. And there's another one, you know, Urban Ladder that was incubated in our office right here where we're sitting and you know, so there are there is a fair share of learnings and growing and mistakes that one has made but fortunately of the existing cohort of companies they've done reasonably well. So talking about anti portfolio which are the other companies you missed investing and they have gone today big and what we're learning from those decisions? Yeah. So like I said TaxiForSure is an interesting one and we know Raghu really well it is before my time I used to be at MakeMyTrip ironically its anti portfolio in some sense for MakeMyTrip as well because we met them in MakeMyTrip as well. So one big thing is that we have traditionally focused much more on digital tech oriented businesses rather than things that require heavy duty on the ground, feet on street Ops(Operations), sales Etc. Right? So that's been a either a conscious trade-off in the one hand or an achilles heel, right? We don't understand those businesses and how to scale those businesses and how to identify and evaluate those businesses. So that has been the common theme right even if I look at both TaxiForSure and to a lesser degree Urban Ladder, we felt that the operational complexity on scaling those businesses and the feet on street and so forth would be much much higher. So those are businesses that we have classically shied away from but in the VC world as in the entrepreneurial world, you always have to have an open mind and we often ask ourselves if the next you know,TaxiForSure or Urban Ladder or XYZ would show up here today in 2019 what would we say, would we make the same decision or a different decision? And that's always something that we keep re-evaluating.