[Know your Investor] Mohit Gulati’s journey from unlocking iPhones in college for an extra buck to becoming a VCSindhu Kashyaap
A self-professed non-IIT passout and an engineering graduate from Pune University, Mohit Gulati, says he would unlock iPhones to make that extra buck during college. Today, at 28, Mohit is possibly one of the youngest angel investors in the country and is also the Founder of Altius Ventures.
Altius, incidentally, is Mohit’s second fund. In 2012, he had started Oliphans, an angel network, with which he made several successful investments. The need to start Altius came with the idea of making more substantial investments and creating a newer way to run a fund.
“I don’t come from any kind of investing background. My parents are doctors and we have a simple background. I had never invested any kind of money before,” says Mohit.
A week into operations and the logistics begin
A week into operations at Oliphans, the team from Ecom Express walked into Mohit’s offices. Mohit says the team, which consisted of ex- Blue Dart employees, requested a million dollars to start an e-commerce-dedicated logistics company.
“This was in 2012 when the markets weren’t great and e-commerce was just picking up, but collectively the five of them were strong and came with solid logistics experience,” says Mohit.
Mohit was in a good position to assess the viability of their proposal. By the end of his second year of engineering, he had realised that his interest didn’t lie in taking up a regular tech job. So, after interning for a Hong Kong-based hedge fund, Mohit continued to work with them through his fourth year of engineering, focusing on financial modelling.
His interest in the world of finance was piqued. By 2009, Mohit had decided that he wouldn’t be joining TCS, despite getting through their interview process, and joined Antique Finance, an institutional firm. His boss from Antique Finance later teamed up with him to start Oliphans.
But with all his experience in brokerage and with the hedge fund, Mohit didn’t have any experience with investments. The Ecom Express team, at that early stage, didn’t have any financial model or investor deck.
Putting your money where your mouth is
While Mohit created a detailed information memorandum and shared it with institutional clients and HNIs, Oliphans went ahead with an investment of their own as they believed that the team and product were worth investing in.
It was Mohit’s bonus and savings that went into Ecom Express.
“While everyone talks about the success stories and how the team raised money, what really mattered to us at that point in time was the skin we put into the game. That is what makes you a differential investor,” says Mohit.
He adds that when you struggle alongside the entrepreneur to set up the business, you automatically become an integral part of the business and decision making. Over the years, the investors saw Ecom Express grow and scale, and soon they got their first exit.
Mohit believes that their background in brokerage made it easier for them to invest in a company. It is also important to know at what time to exit the business.
“From the very beginning, when the team from Ecom Express walked into our office, all the way to our exit, it was a learning experience. I can remember talking to vendors, enquiring after which delivery firms they were partnered with and then pitching Ecom Express,” says Mohit.
In his four years of investing, Mohit has believed in creating synergies and putting his own skin in the game. At Altius, Mohit still follows the same principles that he swore by at Oliphans, he is the largest contributor in his fund. “Whatever little capital I have made, I have put into Altius,” adds Mohit. After Ecom Express, the team at Oliphans invested in Grab, which was later invested in by Zomato and is now their exclusive delivery partner.
Mohit has also backed women-led startups like Tarusa World, Enrouto and Tangerine, a digital marketing firm that had initially raised the money just to set up an office, but is now clocking close to Rs 50 lakhs in revenue in a year. Speaking about backing these women entrepreneurs, Mohit says, "I think women entrepreneurs are much more driven, stronger and more passionate about their businesses and the work they do. They truly put their everything into the business."
It is all about the dominoes
“One of the biggest lessons as an investor is to build your businesses on the right principles. It is important to build a business that is here to stay without venture money or PE funding. These are the businesses that attract capital even when they don’t want it. Also it becomes very important to raise capital at the right time, from the right people,” says Mohit.
Mohit also realised that the best insights into a business don’t come from boardroom meetings, but when you talk to the lowest rung, the feet on the street, of the company. It is when you talk to the delivery boys that you understand the pain points and what on-ground realities are.
His experience with LocalBanya, of which he was one of the first investors, convinced him of the importance of acknowledging ground realities. Several of his friends and family had placed orders with LocalBanya and faced issues, which Mohit had brushed off at the time as one-off events.
“A company just doesn’t shut down because of a lack of capital. That is just one aspect. There are a host of other things that go wrong. With any successful or unsuccessful startup, one thing cannot take sole responsibility. It’s like a domino effect,” says Mohit, while explaining the situation of LocalBanya.
He adds that the market has become extremely competitive in recent times, with even delivery persons commanding twice the salary (from Rs 8000 per month to almost Rs 20,000 a month) that they had been receiving not long ago. He is possibly one of the most sought after people in the startup ecosystem in India.
All the delivery companies, food businesses, grocery players and parcel companies want him.
“This is the time of the year when everyone comes down to earth and truly understands where the money needs to be spent,” explains Mohit.
Building cross synergies
When Mohit and his team first invested in Grab, they were dealing with 200 orders a day; now, they handle almost 18,000 orders a day. He says that it was the biggest investment he personally made and that he has a different equation with the founders of Grab.
From going out and speaking with restaurant owners and converting them into clients, and even recruiting delivery boys, Mohit says he has done it all. When Oliphans had invested in Grab, the food tech buzz wasn’t that big. The founding team was made up of friends from school and they didn’t know what venture funding was.
“They would go to restaurants, print their menu under one booklet, and go out and give it to people in Lokhandwala and ask them to order from Grab,” says Mohit. Today, Grab is the exclusive delivery partner for several restaurants in Mumbai.
Being an investor, Mohit believes that he also is in the position to see synergies across companies and sectors that possibly couldn’t be seen by those with a narrower view of things. Whether it is using the delivery boys of Grab for peak order time for Ecom Express or looking at businesses that can benefit by working together, Mohit believes in leveraging his bird’s eye view to the fullest.
Speaking on what he has understood in all his time as an investor, Mohit says:
“Sometimes the most mediocre of ideas backed by the best people can become massive companies, and sometimes the best ideas, when backed by a mediocre team, can cause disaster. Companies and brands can come and go, but good entrepreneurs find their foothold in the right places. It is important that you become the founder’s best friend and develop a working relationship; that’s how you build a business. Some investors take such cautious steps, and aren’t there for the entrepreneur. Very few take the helm and truly help the startup.”