Have you met Ankur Capital? The story of the new seed fund in town
Though Rema Subramanium and Ritu Verma come from different backgrounds, they are passionate about the same thing —genuinely creating an impact, and supporting entrepreneurs who want to do the same. Besides this, both women wear multiple hats; Rema is also an entrepreneur, and Ritu a physicist.
This passion led the two highly driven and motivated ladies to start a fund called Ankur Capital. Ankur Capital is an INR 40 crore social venture fund that invests in startup businesses (one to three years of on-ground operations) that impact low-income communities in India.
Krishna Kumar, Co-founder of Cropin Technologies, a venture in which Ankur Capital has invested, recently mentioned how Ankur has been not just an investor, but also a big supporter, mentor and an extended team for him as well. This got us excited to learn more about the new fund and understand the investors behind it better.
In an exclusive conversation with YourStory, Ritu Verma, Founding Partner of Ankur Capital, gives us an insider’s view on the fund, its driving force, and what you can expect from it, as an entrepreneur. Read on:
YS: Tell us about life before Ankur Capital? What made you start this?
RV: I had spent over 15 years in the corporate sector and in investing roles, and a lot of this time was spent outside India. But perhaps, as often is the case, the voice that says I should do something that can make a change in India was louder. Using business as a tool for development was a powerful idea that resonated with me and pulled me into impact investing. I used to be a physicist, and innovation and getting new ideas to market had always been part of my previous roles, so naturally I was drawn to very early stage enterprises. When I returned to India and started working as a mentor to social entrepreneurs, I realized the gap they faced as entrepreneurs was very large, especially in the impact space. Money was only one part of the challenge — long term and vested advisory was another one. That was the trigger to set up Ankur.
YS: Rema and you are two founding partners at Ankur Capital. How did you come together?
RV: We met while mentoring social entrepreneurs and it was discussions around the gaps that got us to jointly think of how to address it. Rema had spent over 30 years being CXOs of different companies, and had become a mentor with an idea to give back to society. Both of us were passionate about business, and building sustainable inclusive ventures was our idea of impact. This shared vision is what got us together. We’ve had very different experiences and backgrounds and bring different skills to the table, but at the core of it there are fundamental issues that we completely agree upon. This coupled with the fact that we are learning a lot of new things everyday keeps the partnership exciting.
YS: What are the funding ideology and plans of Ankur Capital?
RV: As I mentioned above, funding is only one part of the problem; being able to add value to companies and bring in long-term support is just as important. This is core to what we do at Ankur. Our goal is to kick-start businesses for social impact and partner with them to build the next set of inclusive businesses in India. We bring every rigor that is needed in investments and building businesses (due diligence, governance, financial rigor, professionals etc.), but all of this is topped by the fact that impact is why we are here in the first place, so that needs to grow along with the business.
We’d like to seed the next 200 impact businesses that will change our country and look to lift 100 million people out of poverty. This fund is the first of what we hope will be many such mini-funds that can systemically address this gap.
Ankur Capital is a Rs 40 crore fund and looks at deploying around Rs 50 lakhs initially in a company. We expect to seed 20 companies with the first fund.
YS: What was your initial view of the social impact sector in India? Are you seeing interesting innovations?
RV: I believe there are a lot of ideas and companies that can drive social impact in India. I would hesitate to call it the social impact sector as a lot of these entrepreneurs don’t quite define themselves that way – many of them learn about impact investing long after the idea and the business has been set up. However, in the sectors that we look at we see product and service innovation. In the impact space both play a very important role in figuring out how giving a remote community access to markets can be a mix of products (as well as excellence and innovation in delivery mechanisms).
YS: You have made three investments, how was your investing experience so far?
RV: Our experiences have been very positive with the businesses we have invested in. The businesses have grown, attracted more capital, attracted partnerships that will help them in the long term and have built internal processes and governance. We have been very selective in our investments – given our social impact is the first criteria, what we look for is how this business can empower a low-income community and whether it will continue to do so as it grows. The business model, market etc. all form part of our screening criteria. But if I had to pick two reasons as to why we picked these businesses it would be impact and the entrepreneur. ERC Eyecare, Crop-In Technologies and PBK Waste Solutions are the three portfolio companies.
YS: As a woman professional/investor do you think you bring a different approach to the way you do things? Funding still remains a very male dominated space.
RV: At the core of it we really enjoy what we do — putting out fires, solving business challenges, evaluating businesses, seeing and hearing the stories of impact on ground, and learning from entrepreneurs. Unlike a lot of investors who are interested in cutting deals and don’t enjoy getting involved in the investee business, we derive a lot of satisfaction in doing so. But it is the aspiration, the drive, and the idealism that comes with young companies that keep us going. The largest funders in India are women – just look at the heads of our banks! But yes, the VC/PE space has developed differently. We haven’t thought of ourselves as women investors – so I don’t know whether that is what drives our approach. We do have men on our team and they also think similarly.
YS: You are working with so many young entrepreneurs, what would be your key message to them?
RV: Make sure you are passionate about what you do – it is a long and difficult journey. Dream of building institutions, not kingdoms, and take the 700 million people who live in a different India with you as you grow your venture – it makes complete business sense.
Reach out to Ankur Capital here http://www.ankurcapital.com/contact-us.html