1Mby1M Virtual Accelerator Investor Forum: With Chandrashekar Kupperi, General Partner of Peaceful Progress Fund (Part 2)

Sramana Mitra: Let’s go to a few examples of companies that you’ve invested in within the tech-enabled field.

Chandrashekar Kupperi: The first is an EdTech company. This is a startup that helps students or professionals connect with the right mentors. It all happens via AI. It ensures that any follow-on support is given.

I’ll give you an example. Let’s say someone wants to go into deep learning. They want to understand NLP. The mentor will not only guide them on the basic understanding but also connect the student. This has been doing quite well. They’ve got almost 7,500 mentors onboarded. The user base is more than 300,000 and they’re doing extremely well.

Sramana Mitra: What is the business model?

Chandrashekar Kupperi: It’s basically B2C and B2B2C. They connect to the customer directly and monetize, but they also tie up with other businesses. It’s a SaaS-based model.

Sramana Mitra: I see. Do you have an example in FinTech?

Chandrashekar Kupperi: They started as an HR tech. They onboarded almost 10,000 corporates. They have 400,000 employees or staff. They’ve pivoted. They have bought a neobank. Because they’ve bought a neobank, they’re doing two things. One is, they are able to give the earned wage access. It’s a salary credit which happens in between the month. Slowly, they’re also able to ensure that they’re able to lend based on the credentials of the employee. The reason why they want to do that is that they have a database within the system.

Sramana Mitra: There are a couple of companies that are doing quite well in that space – Earnin and PayActiv.

Chandrashekar Kupperi: The earned wage access was something we initially thought would be difficult to monetize. The sort of traction that they’re seeing is unbelievable. It’s also not too pricy for the employee.

Sramana Mitra: In these two examples that you gave us, how did you meet these entrepreneurs?

Chandrashekar Kupperi: Because we are a co-investment fund, the deal would come from the platform. It doesn’t mean that we will invest because they are introduced. We have conversations with the founders. We have a conversation to understand the motivation of the founder. What is the motivation in terms of ensuring that the founder can build the team?

More importantly, do they map the competition? If the startup entrepreneurs respect the competition, that gives us more confidence because that means that they’re going to come up with some economic moat against the competition. We always ensure that we understand their ability to scale up.

More importantly, do they really understand the problem? Can they execute their solution well? Where we see the difficulty is the execution. Therefore, traction is very important for us. Sometimes, you can’t explain the traction in a quantitative manner.

Sramana Mitra: What is your strategy around the Indian ecosystem? There are larger funds that have been flushing startups with capital and creating lots of barriers with capital. Are you going to act as a feeder into these kinds of situations? How do you parse this?

Chandrashekar Kupperi: The fund’s thesis is very simple. We invest in seed to pre-Series A. If you see the likes of Tiger or Sequoia, they play at higher rounds. We are able to attract lots of startups at an early stage. We are also able to offer support from the LPs to mentor them. Because we co-invest, we also have the ability to do follow-on rounds which helps entrepreneurs ensure that the traction is better.

This segment is part 2 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Chandrashekar Kupperi, General Partner of Peaceful Progress Fund
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