1Mby1M Virtual Accelerator Investor Forum: With Dr. Aniruddha Malpani, Founder of Malpani Ventures (Part 1)

Dr. Aniruddha Malpani, Founder of Malpani Ventures, is an active angel investor in Indian startups for the past decade. Wonderful conversation.

Sramana Mitra: Let’s catch up a bit on what has been going on in our collective universe and how you see the world based on all these years of observing the ecosystem. How do you see the Indian startup ecosystem evolving?

Dr. Aniruddha Malpani: It’s been extremely exciting. I’ve been doing this now for 10 years. Now, we’re a lot more formal about it. We have a structure. It’s an extended part of our family office, which does only startup investments. We have a team of equity analysts. I always tell people that they are the ones who need to do the hard work and due diligence. My job is easy. I just need to sign the checks, but did I learn something as a result of this engagement.

One of the beauties about being an angel investor is you don’t need to answer to anyone else. I only need to answer to my wife. She’s been married to me for too long to do anything too much. She has realistic expectations. The only money I will invest in the startup space is money we can afford to lose without losing any sleep over.

Sramana Mitra: Talk to me a little bit about what you have invested in that you think are interesting in the broader context also.

Dr. Aniruddha Malpani: The startups I learned the most from are the ones that failed. No matter how many books you read or videos you watch, learning needs to be experiential. When you lose money in a startup, that sticks with you. I make mistakes, but I pride myself on not repeating the same mistakes.

At the beginning, it was extremely casual. Now, we’re a little bit more structured. We’re looking for entrepreneurs who understand the value we bring to the table. That’s one of the reasons why we invest a lot of time in what I call information therapy for entrepreneurs. The Indian startup ecosystem is relatively immature. A big problem is, we’re trying to aim for what’s happening in Silicon Valley. A lot of the funding for the startup ecosystem comes from VCs who use the Silicon Valley playbook.

Part of what we’re trying to do is saying that that’s one way of building the business, but that’s not necessarily the best way. That’s something we’ve learned. We need entrepreneurs who are willing to play the long game and who are not looking for quick exits. We are looking for people who care more about their users rather than their investors. It’s not always easy to find them.

Sramana Mitra: Let’s get into the specifics. I’m of the opinion that investors should have an investment thesis. How do you frame the investment thesis for Malpani Ventures? Stage-wise, how do you decide when you want to get in? What sized checks do you want to write? What do you want to see in the company before you write that check?

Dr. Aniruddha Malpani: We are very transparent and open because we want the entrepreneur to be transparent. Whenever anyone reaches out to us, we say, “Please check our investment thesis and make sure we’re the right investors for you.”

We have certain guidelines. Preferably, someone who has paying customers and is bootstrapped. They should have achieved product-market fit and will be using our money to grow. It’s a very conservative mindset. It’s not like we don’t break out rules; we bend them.

Every once in a while, you fall in love with an entrepreneur who doesn’t hit your sweet spot, but you’re willing to take a leap of faith. One advantage about being transparent is that it saves entrepreneurs a lot of time. We, very clearly, define our processes and timelines.

This segment is part 1 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Dr. Aniruddha Malpani, Founder of Malpani Ventures
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