Photo by Colter Olmstead on Unsplash
Photo by Colter Olmstead on Unsplash

While the skies are clearer now with no vehicles, pollution levels still not low due to relentless zoom calls with VCs on how to survive from the epidemic. And from conference call fatigue. In this climate of doom, many of you may feel like you just need to get some revenue somehow, break even, forget about venture capital and focus on golf or tennis. Or maybe, a virus with a rather low fatality rate cannot kill the entrepreneur in you.

Wait for the right time:

Starting in late 1999, Deep Kalra was fortunate to raise $1M from a VC fund…

-Anand Lunia

It was the best of times, it was the worst of times, as Charles Dickens would have described. Some unicorns raised more money than anyone expected to, and some did not get even a bailout. The tale of two ‘cities’ is now about Flipkart and PaytmMall, all in a matter of a year.

For the rest of the ecosystem, it was just about looking for some greenshoots. Here is what I think 2018 will look like, barring an apocalypse brought by pollution or traffic.

Sectors and Themes

  • Fintech will deepen, and lending & investing — which look overcrowded — will continue…

‘Happy birthday! Lets make India better again!’ Fareed messaged on Whatsapp, the app from the American startup that Indians can’t have enough of. It was one of the best greetings I have ever got.

Whatsapp rocks, indeed!

The love for doing something for our country is what unites an investor like me to founders. Yes we want to do things for the world, for the environment, for peace, but the most important cause is to do something for our country.

Amazon thought of India merely as an offshore development destination well after Flipkart was giving a ‘wow’ experience to Indian…

A whole lot of consumer startups have shut down entirely in India, without creating any semblance of value, without solving any problem whatsoever, and without leaving any meaningful lessons for other entrepreneurs to use. Absolutely no salvage value came out of so many $3–20M investments. A host of local services that were supposed to happen on a click still happen with five phone calls and frayed nerves. Online restaurants still need multiple times more capital per rupee of revenue than delivery chains. And we still prefer to buy our furniture in showrooms, so startups have not opened those for us.

-Anand Lunia, with reply from Jayesh Ametha of Capital One

There are about 20 odd funded online lending companies in India, and the market that was supposed be the big find of 2016 is now facing a reality check. Many of the funded companies are already pivoting and many others are seeing serious slowdown of momentum. Demonetization has hit many of them as overall borrowing has reduced since November, but that only hides many other underlying challenges.

The companies that are in the online lending space can be categorized in about 4 categories:

1. Get you the best deal- the…

— Anand Lunia

“A startup is a temporary organization used to search for a repeatable and scalable business model”. A great definition from Steve Blank, one of Silicon Valley’s well known educators. What keeps the wheels rolling is that startups discover these scalable models in a very capital efficient way, delivering multiple returns to investors.

An acceptable definition of capital efficiency will be “high level of financial return on capital deployed”.

The ‘return’ measures that matter early on are Revenue, Network size and Funding Valuation. Network startups like FB, Twitter built their network in the beginning and Tesla will have…

-Anand Lunia

Recently I trolled Shailendra Singh of Sequoia when he tweeted ‘Indian startups need to deliver so much more value per $ of rev than elsewhere, it’s why they can win abroad. big challenge & opportunity’
I said ‘but they are the least efficient in $ capital per $ of rev, and also in productivity, as in $ rev per employee’. He shared details of how they are helping their portfolio cos establish some benchmarks.

Interestingly, Revenue per employee and capital efficiency have been identified by practically everyone as a big systemic problem in India. Bundle this with the…

— Anand Lunia

Since 2015, all VCs in India have a fair idea of the good, the bad and ugly among their investments. The bridge rounds should not confuse an onlooker, because those are driven by a different set of compulsions.

In 2014–15, the VC funding process was hacked, perfected by the IITian fraternity. It went like this: Discuss the hot areas that VCs are looking at, make a plan, raise some angel money from a ‘brand’, ship a sleek looking product, show proof of cohorts by carefully planting discounts, hire some credible resumes; basically get all the ‘ticks’ for a Series A…

India internet opportunity is getting bigger, but not clearer

The one peculiar thing about the Mary Meeker report is that is mentions India and its internet penetration very high up, as early as slide 5, and then gives internet growth data. She notes that India has surpassed the US as the second largest market in the world, much to the skepticism of a lot of Indian twitterati.

(Mary Meeker Internet Trends Report 2016, Slide 73)

-By Anand Lunia and Shailesh Vikram Singh

In a world away from technology, Patanjali is the most interesting comeback of the Indian entrepreneur.

Amazon is winning customers in India because it offers more discounts and not because of any secret sauce.

‘The Amazon of India will be Amazon and not Flipkart or any other company’ is a routine assertion by experts warning of the onslaught of global companies. These experts are using the recent non-performance of investors in India to say that the Indian entrepreneur and the Indian market are not capable of very much. The Indian internet market, which…


Founders create great companies. VCs, like bankers, are service providers to these companies.

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