YourStory’s inaugural Bootcamp was held in IIT Delhi last Saturday and it reaffirmed our belief in the Delhi NCR startup ecosystem. A rocking affair, the participants had unprecedented levels of both passion and intellect. Conducted by Soumitra Sharma from IDG Ventures India Advisors, the Bootcamp was a comprehensive one day session on all aspects of raising venture capital.
The opening session introduced venture capital as an asset class. Soumitra took participants through the Indian and global VC landscape and then elaborated on the economics of business, types of VC firms and the structure of firms. He explained the high-risk, high-return model and why VCs are so selective with their investments.
In the next session the focus shifted to entrepreneurs. Soumitra talked about the pros and cons of going to a VC and how to decide when is the right time to go to a VC. He shared how VCs evaluate businesses and value companies. He then walked through the investment process and shared tips on how to get the VC’s attention and raise capital.
The post lunch session saw two entrepreneurs – Ambrish Gupta of Knowlarity and Abhishek Jain of MyShaadi – share insights from their own fund-raising experiences. While Knowlarity has received two rounds of VC investment, MyShaadi has stuck to angel funding. Ambarish and Abhishek shared the approaches they had each followed for these two very different businesses.
The Bootcamp concluded with a last session on ‘Demystifying the VC Term Sheet.’ Soumitra gave handouts of an actual term sheet and walked participants through the various elements and terminologies. He shared specific insights on key clauses and shared negotiation tips with the participants.
Despite being a full day affair, the participants never felt tired at any point and were completely engaged right through the day. The sessions were very interactive and participants asked some great questions. Soumitra also used several videos featuring top global investors, highly successful entrepreneurs and industry experts to elaborate on key messages.
Key Insights from the VC Bootcamp
- ~50% investment lose money, ~30% break even and ~20% make tons of money
- In the US, VC investments have underperformed the market index over the last 10 years
- However, the story in growth markets is very different.
- VCs receive hundreds of business plans every month so you really need to get their attention
- Name dropping really works during 60 second startup pitches. Also references from college/university, previous employer, angel on board, marquee customers etc.
- A good fund raising cycle in India is around 6-7 months and in hypermarkets like e-commerce it is 3-4 months.
- As an entrepreneur make sure you treat your co-founders as 'Co-founders' and give them air time, don't hog all the limelight alone!
- VCs and investors have a lot to offer more than just capital – leverage them.
- The term sheet should be viewed as an instrument to align incentives of founders with those of investors
- As a founder, it is both your right and responsibility to negotiate hard!
Want to make your startup journey smooth? YS Education brings a comprehensive Funding Course, where you also get a chance to pitch your business plan to top investors. Click here to know more.
- Soumitra Sharma
- IDG Ventures India Advisors
- Ambrish Gupta
- Abhishek Jain
- VC funding
- IIT Delhi