Focus on sustainability, customers before giving priority to investors: Experts tell startups

Focus on sustainability, customers before giving priority to investors: Experts tell startups

Trivandrum / December 15, 2022

Thiruvananthapuram, Dec. 15: Investors should be the last on the priority list of startups and their focus must be on sustainability and customers as the right way to find the right investor is to get their customer funding and satisfaction in place, speakers at a global conclave said here today.

“Once you are making money, investors will line up to give you more money,” they said while attending a panel discussion at ‘Huddle Global’, the two-day Startup conclave by Kerala Startup Mission (KSUM),at The Leela, Raviz Kovalam.

Speaking on ‘Building Sustainable Business Vs Valuation Business,’Dr Aniruddha Malpani, Founder, Malpani Ventures, said every startup is an experiment and the tragedy is that lots of first-time entrepreneurs have been taught to create business plans and look for investors to get funding.

Terming it ‘senseless’, Dr Malpani said investors will approach them if the startup’s product is good. 

Commenting on the growth strategy of startups, he said: “When you tend to grow very fast, your scaffolding, structures and frameworks fall into pieces. Sustainable and scalable ones will continue to survive.” 

Noting the importance of following good accounting practices, Dr Malpani said, “We need to understand that every founder has a different philosophy. Most of the social impact founders are not driven predominantly by financial income. They are predominantly driven by emotional income. It is not a talent that goes from one company to other because someone gives them 10 per cent increment. They care about the mission and vision of the company.”

Some founders, who pitch to funders, want to become the next Unicorn. “But I would tell that I would be thewrong investor for them as I don’t believe in Unicorns,” he said.

Dr Malpani said part of the problem is that so much of the Indian startup press (media) is funded by VCs because they control most of the startup press. “That means you really don’t see the other 90 percent of startups that are building sustainable businesses since they don’t have money to waste on PRs, advertising and marketing,” he observed.

He said the Silicon Valley model is great for the US where capital is available, cost of money is cheap and people are willing to sign those kinds of cheques.

“It is ridiculous that we as investors tell our entrepreneurs to be creative and innovative but we as investors end up copying and pasting what everyone is doing,” DrMalpaniadded.

Mr Anil Joshi, Managing Partner, Unicorn India Ventures, said valuation is a mechanism to recognize potential value of startups and their sustainability is very important from an investor’s perspective.

Mr Ashish Taneja, MD, GrowX Ventures, said as an investor, his firm is trying to create a balance portfolio with Unicorns and workforces.

Highlighting that entrepreneurship is a gift, Mr Taneja said founder-investor relationship is very special and good founders havethe skill to read market very well.

Mr Sanat Mondal, VP & Principal at IAN Fund and Indian Angel Network, was also present.Mr Shareeq Shamsudeen, Market Feed, CEO, was the moderator.