1Mby1M Virtual Accelerator Investor Forum: With Janam Mehta, Partner of Campus Fund and Venture Investments at JSW Ventures (Part 4)

Sramana Mitra: Have you invested in a PaaS company?

Janam Mehta: Purple.com is an e-commerce platform company. Healthflix is a very good example. They’re an EMR. They use data to help pharma with their research and give them insights. That’s a very good example of aggregating data from SaaS and making it a platform business.

Sramana Mitra: It’s not very easy to get platform companies to go to market as platform companies before Series A.

Janam Mehta: Right. Let’s say they start out as an e-commerce company.

Sramana Mitra: Or a SaaS company.

Janam Mehta: SaaS moving to PaaS is quite obvious.

Sramana Mitra: It happens much later though. I’m having conversations with SaaS companies that are sizeable and are not into platform yet.

Janam Mehta: I would probably say that SaaS companies thinking of turning into a platform are companies that have some sort of a market share or a strong brand. In India, we have this company called Darwinbox which is an HR tech company. I’m seeing that they are moving into a platform approach.

Sramana Mitra: There are only three companies that have made a real shift to being a platform company. One is Salesforce, two is Twilio, and three is Atlassian. I would say those are the only three well-executed instances.

Janam Mehta: How do you define a platform business in a SaaS product? Would it be having a marketplace of third-party applications?

Sramana Mitra: Yes, it’s part of the definition. You have to have the developer stack such that third-party ISVs can build on top of that platform. Then you need a marketplace where they can sell that product. There is a nuance which is a lot of SaaS companies are opening up their platform for extension within their enterprise customer base.

If you look at ServiceNow, they’re trying to do this kind of platform strategy and then they abandoned this. They went straight into the enterprise. Within the enterprise, they have APIs through which to expand. That strategy is followed by more people. A lot more companies are following the API integration strategy within their customer base. The true ISV strategy, I have seen very few instances.

Janam Mehta: They’re able to pull that off either because of market share or a strong brand name.

Sramana Mitra: Absolutely.

Janam Mehta: That’s the metric at Series C or Series D. At Series A, you would think, “Can this company lead the vertical it’s operating in?” A lot of horizontal products have already taken shape. You already have large companies playing.

Sramana Mitra: Horizontal is a tough go-to-market.

Janam Mehta: Exactly. It’s always easier to crack one vertical and then expand.

Sramana Mitra: Talk about Campus Fund.

Janam Mehta: Campus Fund was started by the founder of the first company that I co-led. It’s based on the dorm room concept. We go to universities in India and onboard students that behave as ambassadors and deal scouts for us. We have an IC that is set up by students or by recent graduates. They got through some vetting and we invested 50 lakhs through a safe note. This is generally pre-seed level. They’re usually at the MVP stage.

We try to build synergies across the ecosystem. We have a lot of partners from VC funds that support us who speak to us at Campus Fund. We are able to do quite a good job. We’ve now invested in 7 to 8 companies. Four have already gotten follow-on investments from large Indian VCs. We’ve been quite active. We are trying to put together this student entrepreneurship ecosystem in India.

Sramana Mitra: How big is the deal flow?

Janam Mehta: We have approximately 30 people that look at companies for us. Last year, we spoke to 500 to 600 startups. We have a 1% conversion rate.

Sramana Mitra: Very interesting. Thank you for your time.

This segment is part 4 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Janam Mehta, Partner of Campus Fund and Venture Investments at JSW Ventures
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