The coronavirus pandemic has got startups across the globe thinking about how investments will pan out. Will venture capitalists stick to their previous investment thesis or will their sentiments change once things go back to normal? In a conversation with Aalesh Avlani, Co-founder of Mumbai-based venture capital fund Samyakth Capital, YourStory discussed the VC’s journey so far, its investment thesis, and investor sentiments amid the COVID-19 pandemic.
Aalesh Avlani, Co-founder of Samyakth Capital
Samyakth Capital is a hybrid growth fund, investing in emerging asset classes. Founded in April 2017 by Aalesh Avlani, Anuj Golecha, Gaurav Gandhi, and Rishabh Golchha, Samyakth Capital also provides expansion support to startups. It offers debt and equity financing options, by syndicating with other investment groups. Family offices from Chhattisgarh, Hyderabad and Mumbai are aligned with the fund.
So far, Samyakth Capital has made more than 35 investments across concept to Series C phases. It has invested in startups including furniture and appliances rental marketplace RentoMojo, FMCG brand Lo!, fintech startup BharatPe, car financing startup OTO, home rental marketplace ZiffyHomes, and voice AI platform Observe.ai.
Other companies in its portfolio include facial recognition technology startup Mirror.AI, social commerce platform CoutLoot, personal care startup PeeSafe, financial services company Kredent InfoEdge, Latin-America based Keynua, sports company Global Esports, and analytics company Rankz, among others.
The journey so far
An alumnus of Questrom School of Business, Boston University, Aalesh worked as a private equity analyst at SEI in the US, before returning to India in 2017.
“Working on large-sized deals in a more mature market like the US made me realize how nascent the Indian startup ecosystem was, in comparison,” Aalesh says.
In June 2017, Aalesh co-founded Samyakth Capital along with the other three co-founders. “The idea of working closely with like-minded entrepreneurs and learning from them worked as a major motivation for me and I knew this could only be possible while working as a VC,” he says. Aalesh says the Samyakth Capital journey is very similar to that of any other startup – involving processes like fundraising and operations. “No day is similar as we get about five new deals every day and I don’t think such learning would have been possible otherwise,” he says.
Team at Samyakth Capital
The investment thesis Samyakth Capital was founded to invest in both growth-stage companies and cash-generating businesses. It usually invests at an early stage (pre-Series A or Series A) as equity investors. Post this, the VC provides debt via structured debt transactions, usually aimed at rapid growth and expansion.
“The aim is to help portfolio companies at multiple stages of their fundraising journey,” Aalesh says. He has personally invested in about 39 companies in the last three years.
Aalesh says one of Samyakth Capital ’s biggest and earliest investments was in hair transplant clinic Assure Clinics. It invested in Assure when it was operating out of only one clinic; today, it has eight centers across the country.
He says, “A portion of the capital is focused on early-stage companies where we provide not only capital, but also guidance in improving tech capabilities and strategic development. With these companies, we come in at seed or pre-Series A stage,” Aalesh says.
Additionally, Samyakth Capital also provides structured debt to companies. This usually happens when a company has passed its Series A or B rounds of funding, allowing the VC fund to grow along with the company.
The VC fund seems to mostly invest in companies serving millennials (RentoMojo, ZiffyHomes, OTO, Lo!, etc). On this, Aalesh says millennials have become the target audience for most companies, as India becomes the second largest online market in the world.
“Growing millennial adoption opened up several avenues such as streaming and e-sports, which was one of the primary reasons for our investment in Global Esports, an e-sports company that aims at building teams to compete in gaming tournaments,” Aalesh says.
Talking about their investments in companies like RentoMojo, Observe.ai, BharatPe, and PeeSafe, Aalesh says Samyakth Capital invests in companies that are trying to solve a “genuine problem”, and that these companies were the “first movers in their respective industries”. Additionally, he reveals that the hunger and desire of these founders were infectious. “Creating a fear of loss among investors is very important while fundraising,” he adds.
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