Learnings and failures aren’t restricted only to entrepreneurs. Early-stage investor Mohit Gulati talks to YourStory on his new fund ITI GO and his learnings.
Early stage investor and one of India’s youngest angel investors, 29-year-old Mohit Gulati is at the starting line again. This time with his fund ITI Go. The engineering graduate from Pune University, who says he unlocked iPhones to make money during college, is also the co-founder of Altius Ventures and angel network Oliphans.
Started in 2012, Oliphans made several successful investments and got an exit from logistics startup Ecomm Express. Mohit co-founded Altius to make more substantial investments but had to soon shut shop.
Mohit's other significant investment is Mumbai-based delivery platform Grab.
Recalling his meeting with Ecomm Express, Mohit says Oliphans was a week old when the team from Ecom Express walked into Mohit’s office. The team, made of ex-Blue Dart employees planned to start an ecommerce-dedicated logistics company and pitched for a million dollars!
Mohit adds that when you struggle alongside an entrepreneur to set up the business, you automatically become an integral part of the business and decision making. Over the years, the investors have seen Ecom Express grow and scale, and even give them an exit.
With his new fund ITI GO, Mohit is gearing up for better and deeper partnerships. Edited excerpts of an interview.
YourStory: You started ITI GO while still with Altius. Why a new fund?
Mohit Gulati: Altius was my own entrepreneurial venture where I practically made all the mistakes I advise young founders to not make. My parents are doctors and we have a simple background. Whatever I have done in investment is learning on the job.
With ITI GO, I am in a larger setup with a lot of fire and muscle power to create the changes I had set out to make. I have tied up with the ITI Group, which along with its over 20 companies, renders tremendous cross synergies to our fund across verticals such as equity, venture, debt, investment banking, IPO etc.
Individual angel investing is possible only up to a point. It plateaus after that. Plus, the thought of not making money for others is boring. A formal fund structure gives us the bandwidth to straddle across a much larger ecosystem and build a lot more value to people associated with the fund.
YS: What is the key purpose of the fund?
MG: ITI Go aims to become one of the leading "next generation" early-stage VC funds, with attractive investment opportunities in both tech and non-tech space. Being actively involved with all of our investments, we seek to develop close relationships with founders and management teams.
We are collaborative and patient in our approach and believe in supporting the entrepreneur at all levels. Our endeavour is to provide the necessary management inputs towards developing the company's future and business strategies without either seeking management control or interfering in day to day activities. The Fund further provides strategic support through its network and active partnership.
YS: What is the corpus of the fund?
MG: The ITI Growth Opportunities Venture Fund hit the first close at Rs 30 crore with the entire amount coming as sponsor commitment from ITI Group. The fund aims to raise Rs 100 crore and has a greenshoe option to raise another Rs 50 crore. It is targeting both domestic and overseas Limited Partners (LPs) to raise the capital. However, it has made a soft commitment for the entire Rs 100 crore and aims to make the final close in the next 12 months.
YS: How did you build your core team? Give us their background.
MG: I’m a firm believer that we all follow a script that has been orchestrated somewhere high above. And that is one of the ways I think the core team was formed. In Snehal, Vishwa and Nandini, I’m surrounded by three extremely passionate women each with their distinguished skill sets and a common goal of proving their mantle.
I proudly quote this - My team works way harder than I ever do. Their intelligence compels/inspires me to bring my ‘A’ game to work each day. It’s extremely satisfying to work in an environment where each day, each person walks in happy and gives in their best towards the work they do.
YS: What are the sectors and businesses you are focussing on?
MG: By virtue of being an early stage fund we are broadly sector agnostic. That said, we don’t believe in investing in cash guzzling businesses and would selectively refrain from engaging with founders in those domains.
At the moment we are excited about a few emerging trends in retail, electric mobility, Indian language content, and healthcare, and are making bold bets in companies working in these spaces. Our past investment track record has taught us that money is made when you catch a trend before it takes off vs betting on ‘hot’ spaces of today.
YS: What do you look for in a founder before investing in the startup?
MG: One of the most important qualities we look for in a founder is their obsession with the product. Unless the founder is not undeniably convinced, there is little reason to believe that they can convince somebody else. Complementing this, another must-have is a vision for the product. They should be imaginative enough to envision to what extent they can scale and build their product.
YS: What are the key things about a startup that would make it stand out for you as an investor?
MG: Too many startups focus on the same ideas and flock around the same sectors like ecommerce or foodtech, without doing anything different or innovative. We selectively invest in companies operating in high growth sectors and create value for all stakeholders. The companies that are capital efficient (cash flow backed), have the potential to scale rapidly and are early movers, generate interest from us.
YS: What should startups keep in mind before they reach out to you?
MG: Honesty - this, in our opinion, is the single most important parameter most entrepreneurs forget in their pitches and calls. If you don’t have something right or built, it’s fine. Just be honest about it. We are extremely honest in our mission. We want to invest in good businesses backed by honest good founders, which in turn, will make us honest returns at the fund.
Sometimes, showcasing the ability to put your head down and building a genuine business the right way without the ‘shor’ is what most entrepreneurs forget to communicate in their pitches.
We take pride in only being associated with companies that are built on the right principles of business. If you have these, then you’re eligible to pitch or else go and give your hogwash story to our competitors.
YS: Could you share details of some of the first investments you intend to make and why?
MG: Unfortunately, we can’t disclose the names as of now; but be rest assured all our first five investments are spaces, which are not too ‘hot’ but will be extremely in-favour in the times to come. Thinking and investing ahead of the curve is what we like to take pride in.
YS: What can we expect in the near future?
MG: A Rs 100 crore - Rs 150 crore fund is only going to satiate our appetite for two odd years. We plan on doing a $75 million Venture Debt fund clubbed by an equal size Fund 2 within the ITI Growth Opportunities Structure.
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