1Mby1M Virtual Accelerator Investor Forum: With Sasha Mirchandani, Managing Director at Kae Capital 2020 (Part 6)

Sramana Mitra: Is there anything else that you want to highlight from your experience or portfolio before we move to the entrepreneur pitches?

Sasha Mirchandani:  What we’ve learned over the years is that large markets are critical. A lot of times, we go after really good entrepreneurs, but the reality is going after a very large market helps the cause tremendously. I encourage entrepreneurs to think through the markets they’re going after.

When you hit the right market, the opportunity to become a very big company is so much easier. I had companies which we funded in 2001. They eventually got to the market in 2010 and most funds don’t have that time. They don’t have 10 years to get to scale and get out.

For example, my analytics company started in 2001. Today, it’s a huge company, but because I held it privately, we could take our time to build and get to scale. Otherwise, it’s very important to time the market. 

Sramana Mitra: Well, timing makes a huge difference. I think the size of markets and the timing of markets are bigger drivers in entrepreneurial success than people. Mediocre people in hot markets with the right timing can make great companies happen. 

Sasha Mirchandani: Mediocre people can never make it happen, but a solid entrepreneur can make it happen. A very good entrepreneur in a very small market is much more difficult.

Sramana Mitra: If you’re trying to build a venture-scale company, you need large markets. That’s the bottom line. I think the timing is a very important thing. That’s one of the things that we talk about a lot in our program because we work with very early-stage entrepreneurs.

You kind of have to have a runway, especially if you’re trying to do something contrarian – something different that the market is not yet ready for. You are betting on timing, essentially when would the timing hit.

You are talking about online pharmacies in India and COVID has accelerated that. There are a lot of companies that have benefited from COVID because of the extensive online push that has happened in the last six to nine months.

In many cases, those markets were growing much more slowly. The online pharmacy was not growing as fast before COVID. 

Sasha Mirchandani: We are paid to figure out the weak signals. There are weak signals as we speak for opportunities, so we were paid to see the weak signals in online pharmacy before other folks. We missed many other categories where someone has read the weak signals.

For example, mobile before mobile explorer. The folks who invest in oil companies in India, those are the firms that benefited tremendously. The weak signal is critical for us to assess. If we think something here is a weak signal, that’s going to become a full-on signal in a couple of years. Then we need to jump in now.

Sramana Mitra: It’s not easy to gauge how, when, or how long it would take for a weak signal to become a strong signal, so you make bets. Sasha, it was great catching up with you and hearing more about what’s going on.

We’ll keep in touch and have you back again. Thank you for your time.

This segment is part 6 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Sasha Mirchandani, Managing Director at Kae Capital 2020
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