Seed Capital From Angel Investors: Padmaja Ruparel, President, Indian Angel Network (Part 6)

By guest authors Irina Patterson and Candice Arnold

Irina: Do entrepreneurs have to have previous senior executive experience?

Padmaja: No. They need to have two things. One is an understanding of the domain, and the other is a bit of a complementary skills within the team. You don’t want to be investing only in a “CTO,” because he or she may be able to produce the best technology but who’s going to take it to the market, commercialize it, and create the revenue line? There is a bit of the complementarity that we look for.

In fact, in one particular investment we recognized very early that there was the marketing or the commercial person missing. So, we actually did a bit of an innovation in the angel process and located somebody who was a perfect marketing/commercial person and embedded him into the founding company. This really did help as the company won an exclusive order for over Rs. 125 crores (over $26 million).

Irina: So, if the team is not complete, you can help them to find who is missing?

Padmaja: Yes. We have a database of people who want to work in startups. We don’t always necessarily get it right, but we do try.

Irina: What is the most important character trait for an entrepreneur to have?

Padmaja: Three things. First, if he or she is going to lead the venture, that person must surely have an understanding of the domain and how it works. An entrepreneur must have an ability to market and also the ability to understand how the delivery will happen, even though he or she may not drive it.

Number two, an entrepreneur should know deep enough that he or she is not a pushover, yet mentorable enough to take in new ideas that investors or teammates may come up with or feedback customers may give.

The third, which people do not really enunciate, but to my mind, [is important] is integrity of thought, action, intent. One doesn’t enunciate it very often, but I think beneath any diligence, that is an underlying point that one looks out for.

Irina: Yes, integrity is very important. Now, let’s talk for a moment about those companies that you would not invest in because for some reason they are not ready. What do you do for them?

Padmaja: There are three or four things we do. First of all, we tell them what the investors were feeling or what the gap was. On the basis of those gaps, we cannot progress at that time. So, they understand why we are declining them. Then we give them suggestions (i.e., these are the gaps, but here are some suggestions) so they get some value feedback. We could well say, You are wasting your time, go back to a job, because we think that’s honest feedback. Then, if we think we can help them connect, then we tell them, For this, we think this may be a useful organization – or person – if you like, we can connect you to them.

This segment is part 6 in the series : Seed Capital From Angel Investors: Padmaja Ruparel, President, Indian Angel Network
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