With the startup culture becoming increasingly popular, it is very important to have investors that bring value to this ecosystem and also help these startups grow in the right direction.
One such investor is Dr. Srinivas Chunduru, the founder of VANS Group (VMentor.ai| VANS Investments| VANS Foundation) and also an investor in many new-age startups. Also a serial entrepreneur, Dr. Chunduru has more than two decades of experience in diverse functions including P&L Management, Corporate Strategy, M&A, Sustainability, and Strategic HR.
Team Sociobits connected with Dr. Srinivas Chunduru to understand his investment philosophy, what is important for startups to grow, and more.
- What do you think is the future of the startup culture globally?
Many people are talking about “winter” in startups and the drying up of funding. However, my view is this is temporary, the startups are here to stay and create a positive impact in solving some of the critical human and business problems. I think many newer countries will evolve as “Valleys” of startups.
- Is there anything that we can change to develop or give a boost to the startup ecosystem?
In the current ecosystem, a couple of elements seem to be missing and can unlock a large potential and these are :
- Lack of tight integration with the B-school and graduate schools. A comprehensive platform that will support the startups with research through internships is missing.
- Leveraging strengths and synergies between the startups and sharing the best practices
- Lack of structured “Kid’prenuer and School’prenuer” incubators
- How important is the role of mentors when it comes to guiding budding entrepreneurs?
The concept of mentorship is often confused with that of an advisor. I think the role of a mentor is much more nuanced, involved, and broader. I think it is extremely important to have a mentor, who has his/ her skin in the game (either through investments/ sweat equity/ commitment to the outcome) and the engagement has to be extremely structured and at the same time flexible to adapt to the ever-changing environment.
“I think it is extremely important to have a mentor, who has his/ her skin in the game and the engagement has to be extremely structured and at the same time flexible to adapt to the ever-changing environment.”– Dr. Srinivas Chunduru
We at Vmentor.ai work extensively with startups at different stages to handhold them and work alongside them to deliver results.
- If you would like to give one piece of advice to all the budding entrepreneurs who are looking to raise funds, what would that be?
Focus on building a robust sustainable business model and an ethical organization. Valuation should be an outcome of the same and not a primary focus.
- What have you learnt in your journey as an investor?
- Never invest in companies, where you are not able to add positive value and support the vision of the founder. One of the key criteria for us for investments is our ability to add value to the business.
- Spend a lot of time with the founder of the potential investment to understand his/ her thought process, way of working, vision, and style of working before the investment is made. Investment is always based on the founder and his/ her qualities.
- How did you get into the investing or funding space?
It was a very natural and organic process. We established Vmentor.ai as a platform for structured mentorship to support corporates and startups through 2 of our signature products and offerings i.e., Meraki (Interim CXO services) and 10X (strategic and functional interventions for delivering growth). We started working very closely with founders, and teams and were part of teams taking ownership of end results and growth.
Investing was a natural extension and also an indication of our skin in the game while mentoring the organizations/ startups.
- What are the easiest thing and toughest things about being an investor?
Nothing comes easy! The toughest part is judging the quality and intent of the founder. The ability to analyze business models, viability, customer segments, and financial feasibility is relatively objective and with experience can be managed well. However, judging the quality, chemistry, and intention of the founder is a learning experience and every investment has to discover/rediscover the same.
What we look for in a good founder is clarity of vision, style of operation/ decision making, values, and last but not least; will we be able to comfortably work with them basis our style and values
- What is the common mistake that businesses make while pitching to investors?
“All is well” is overly focused and an extreme amount of optimistic projections (slightly different than aggressive) is one common error. Lack of focus on the identification of risk and mitigation is another common mistake most founders do.
- How do you spot a good founder?
This is a million-dollar question and I must admit that like most investors, we are also learning. We erred in our judgment in a couple of our investments as well. But largely, what we look for is clarity of vision, style of operation/ decision making, values, and last but not least; will we be able to comfortably work with them basis our style and values.
- What are some of the red flags that you have faced in your investing journey?
As I have already mentioned, we have erred in our judgment in a couple of investments. Lack of transparency in sharing information on a regular interval, High salaries of founders (relative to the stage and size of business), inter-party transactions, and team structure (or lack of it) are some of the red flags.
- Would you like to mention your investments?
We have invested in over a dozen businesses including a company that’s now a unicorn. Most of our investments have been in Health food, Sustainability/ Clean energy/ Climate, and Edutech’s.
This interview gives us a basic overview of the mistakes that startups should not make while they look for good investors. Dr. Chunduru has also added points that can help an investor decide if investing in a particular startup matches their ideologies or not.