1Mby1M Virtual Accelerator Investor Forum: With Vikas Choudhury of Pivot Ventures (Part 3)

Sramana Mitra: It sounds like you are very comfortable with getting into markets that don’t have a lot of traction, which is unusual in India. What drew you into angel investing at that point?

Vikas Choudhury: It was actually something that wasn’t really orchestrated. I was running a software analytics company at that point in time. There were a bunch of us who were third or fourth generation entrepreneurs that were also looking at alternative investment opportunities in India.

We had a few common friends who pitched ideas to us at that point in time saying, “We would actually like to be mentored as we build businesses in the tech ecosystem.” We said, “We’ll put our money where our mouth is. We’ll mentor you, but we’ll also take a small equity stake.”

It was a point in time when angel investing wasn’t even a term understood in the country. We were almost the pioneers of that. It was a pure entrepreneurial catalyst process that said, “Let’s come together and put together a few businesses.”

Each one of us was already doing day jobs. We wanted to diversify the portfolio. We wanted other entrepreneurs to benefit from the learning that we’ve had. We had the ability to open a lot of doors whether it was strategic or financial. 

Sramana Mitra: Let’s come to Pivot Ventures. The ethos of the kind of investing that you started with where you were willing to look at green-field opportunities where markets were not yet developed, does that transfer to Pivot Ventures? Or are you being more conservative?

Vikas Choudhury: The investment vehicle has changed. The time has changed where the level of entrepreneurs and entrepreneurship has grown many fold. We’re also 14 years into the ecosystem. We’ve moved our focus up a little bit into a pre-Series or a Series A capital.

Now, there are several early-stage funds. We co-invest with a lot of the early-stage funds and even a lot of the blue-blooded Series A funds. As you know, all the big Silicon Valley majors do write very early stage checks in India.

We like to have runway of capital. We like to give more capital to the entrepreneur, because you then have the ability to try, fail, or succeed in your early attempts and reach some critical mass. That’s where our head is at.

Sramana Mitra: If you talk about Myntra in the early days, apparel was going to get sold on internet in principle. It was early. There are other markets that have that dynamic. Consumer healthcare has that dynamic. A lot of FinTech has that dynamic.

You may have little bits and pieces of proof points. It makes sense, but it may not have complete market proof points. Does your pre-Series A investment comfort zone include ventures that has that kind of market immaturity?

Vikas Choudhury: We are not averse to entering businesses at an early stage. You’re absolutely right. Healthcare is an area of expertise that we have in the family office. We do look at early-stage businesses. Having said that, there is more capital available to deploy and the product-market fit is something that can be rapidly developed in today’s market. 

This segment is part 3 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Vikas Choudhury of Pivot Ventures
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