[YS Exclusive] 76 startups and counting: why 500 Startups is betting on India

Courtney Powell originally came to know of 500 Startups when she went through Batch 4 of their San Francisco-based seed accelerator programme in 2012 as the Co-founder and CEO of PublikDemand. She went on to become CEO of Agent Pronto, one of the largest real estate agent referral services in North America, which was ultimately acquired by Fidelity National Title Group. Immediately prior to becoming COO at 500 Startups, she was the Head of Corporate Development at Keller Williams, the largest real estate franchise in the world, with over 170,000 agents doing more than $330 billion in gross sales volume during 2018 alone. During her time at Keller Williams, she established the company’s first corporate innovation programme, and worked with Keller Capital to invest and acquire tech companies in the real estate space.

Courtney is now the new COO of the VC fund that is known to have created 16 unicorns and has more than 66 companies valued at $100 million globally.

She tells YourStory, “My experience in founding companies and raising money as a woman and a young mother from outside Silicon Valley opened my eyes to the adversities many face when doing the same. 500 Startups was a beacon of hope to me as a founder, and I’m ecstatic to join it in and bring opportunity to founders across the world.”

In this interaction, Courtney takes us through 500 Startups' plan for India, her advice to entrepreneurs, and some of her favourite reads.

Edited excerpts of the interview:

YourStory: Can you tell us about your role as COO for 500 Startups and your plans for all the regions?

Courtney Powell: 500 has already reached an exciting scale, managing over $500 million globally in committed capital*, having invested in over 2,300 startups in 75 countries around the world. It is considered to be the most active global VC fund in the world in terms of investment and comes second in terms of exits. 500’s portfolio includes 16 companies that are valued at over $1 billion, including Credit Karma, Talkdesk, Canva, Intercom, Gitlab, Grab, Bukalapak, VTS, The RealReal, Twilio, and SendGrid*.

Even with the undoubted success we’ve had to date, we truly feel like we are just getting started. We’re looking forward to identifying markets for new funds, more partnerships, and increased local presence in 2020.

To do this, as COO, I lead day-to-day operations and work across the company to identify ways to better prepare to scale even further. I spend a lot of time collaborating with our investment partners around the globe, meeting founders, working with our internal team to support our founders and funds, and meeting government leaders and partners around the world who share the same vision as 500 for seeding entrepreneurship as a means for societal advancement.

YS: What does it mean for a startup to be associated with 500 Startups?

CP: 500 Startups is a venture capital firm on a mission to discover and back the world’s most talented entrepreneurs. We encourage founders from every country, background, and industry to apply to our accelerators around the world. We have long been focused on building a diverse and inclusive team, portfolio, and partner base. In fact, we believe this early focus on building a diverse portfolio has been key to our success.

ALSO READ

Zoho founder Sridhar Vembu cautions Indian startups against being misled by 'money', says slowd...

YS: What advice do you give first-time entrepreneurs? Is there a playbook?

CP: Being a first-time entrepreneur is equally exhilarating and terrifying. You wake up every day as the single most critical factor to the success of your business, and that can feel overwhelming. When you are forced to wear many hats as a founder, you must prioritise your time and effort ruthlessly. Usually, that means iterating on your idea again and again until you know you have something that customers want. Do what it takes to be able to run those early experiments. Until you have at least directional product-market fit, little else matters.

YS: Can you tell us about all your funds by region and how have they have performed? What are your five favourite startups globally?

CP: Within the 500 Startups' portfolio of more than 2,300 companies, 26 percent have at least one female founder, and nearly half of all the investments made are to companies based outside of the US. Of 500 Startups’ 16 unicorn investments (companies with $1 billion+ valuation), seven are non-US companies, which is a number we expect to grow as more and more technology companies are developed internationally. Additionally, 500 Startups’ portfolio contains more than 80 investments valued at $100 million to $999 million, or more commonly known as “centaurs.”* A few of my favourite global unicorns are Canva, Grab, Bukalapak, Revolution Precrafted, and TalkDesk.

YS: Can you tell us about your corporate connect programme at 500 Startups?

CP: Leading companies around the world know that they need to access the best innovation no matter where it is found. These smart companies understand that innovation is important and take the right actions by engaging with startups. However, corporates often struggle to navigate the startup landscape, partner efficiently, and run solution-oriented pilots that drive their business forward. That’s where 500 Startups can come in. Today, we are scaling that at a global level: we are helping Mitsubishi Corporation learn from early-stage companies in Silicon Valley, Sberbank accelerate startups in Russia, and AirAsia as it establishes a global venture capital fund alongside a strategic partnership with 500 Startups, among many other examples.

YS: How does an entrepreneur find a mentor and coach for their startup?

CP: Few founders, especially first-time founders, have all of the skills and experience they need to run a company through every phase of its lifecycle. You may be particularly adept at product, design or engineering, but have no clue how to manage a team. Identifying your superpowers and deficits early on is critical. As a founder, you can outsource many things early on—accounting, formation, perhaps even some components of marketing or even engineering—but you cannot outsource vision, people management, or keeping money in the bank. I see tremendous value in working with executive coaches and mentors to accelerate your time to skill acquisition.

ALSO READ

[YS Exclusive] Robotaxis, fuel cells, and battery tech will be mainstream by 2030, says Contine...

YS: Can you tell us 500 Startups’ strategy in India?

CP: 500 Startups began exploring India as early as 2011, shortly after it was founded, and long before most Silicon Valley venture capital firms took an interest in the region. What began as exploratory travels to Delhi, Mumbai, and Bengaluru to learn more about the nascent startup ecosystem turned into investments into a number of promising Indian companies. 

The startup landscape in India is changing rapidly, with greater access to capital, a ridiculously talented technical founder base, and increasing support from national and regional governments for entrepreneurial initiatives.

We’re thrilled to see the progress in India since we began investing here in 2011, and intend to prioritise the country as a market for investment and expanded opportunity in 2020.

Some context on our involvement in India: to date, 500 Startups has invested in 76 companies in India, with 22 of these companies having participated in the global seed accelerator programme based in Silicon Valley. These companies span a number of cities across India, including Bengaluru, Delhi, Mumbai, Chennai, Jaipur, and more.

Notable Indian investments in the 500 Startups portfolio include Cars24, an online vehicle marketplace; InnovAccer, a machine learning and big data platform; Zapr, a media insights tool that provides user engagement data; POKKT, a mobile video advertising platform; Youplus, a video opinion search engine; Springboard, a platform for online professional education courses; Oxford Caps, a tech-enabled student housing company; Junglee Games, an Indian skill games company; POPxo, an online community for women; Instamojo, an on-demand payments and ecommerce platform; and HeadOut, a marketplace for helping travelers book experiences.

Sixteen of 500 Startups’ investments in India have been acquired, including ZipDial (acquired by Twitter), Little Eye Labs (acquired by Facebook), Playcez (acquired by IndiaMART), and TargetingMantra (acquired by Snapdeal).

YS: What are your thoughts on buzzwords like AI, blockchain, and edge computing. What type of startups does 500 Startups want to work with?

CP: 500 Startups' investment strategy is historically sector-agnostic. We take the same approach in India. Broadly speaking, our investment thesis covers investments that are principally focused on consumer and enterprise internet companies, deep technology companies, and consumer brands, but what really excites me is meeting a founder with domain or market expertise, vision, urgency, and the ability to build a great team.

YS: Do you believe we need to create a bridge for women to become entrepreneurs?

CP: I believe that women face unique challenges in entrepreneurship. Culturally, in many parts of the world, women are still looked at predominantly as homemakers, either directly or de facto in the running of the home, and allocation of responsibilities related to caring for children.

Women who decide to focus primarily on their career, let alone on entrepreneurship, may be judged for delaying or forgoing more domestic roles, and for those who decide to pursue entrepreneurship, they may face challenges in raising capital as venture capital and banking are still dominated by male decision-makers who may consciously or subconsciously apply a different standard to women.

I believe women need to see female entrepreneurs, of all ages, races, and variations, succeed in business to know they can do it too. 500 does this by ensuring we have a diverse leadership team, investment partners, team, and proactively seeking female entrepreneurs to support. 

YS: What books would you recommend every entrepreneur reads?

CP: Venture Deals by Brad Feld and Jason A Mendelson - a must-read for anyone looking to raise capital from a Silicon Valley venture capital firm.

The One Thing by Gary W Keller and Jay Papasan - a great framework for prioritising your efforts and focusing on the ‘one thing’ that really matters to make progress.

Shoe Dog by Phil Knight – a fabulously entertaining and authentic story of how the Nike Founder started and scaled the shoe company.

The Alchemist by Paulo Coelho - a reminder of the journey we all are on.

Some podcast recommendations would be Stanford Entrepreneurial Thought Leader podcast, featuring real-life stories from successful entrepreneurs and venture capitalists; and Naval. Naval Ravikant is the Founder of AngelList and a famous Silicon Valley investor. I suggest the episode ironically titled, How to Get Rich, which is a compilation of many episodes that has helped me keep my mind properly oriented on success.

I’m also in the middle of reading the novel A Gentleman in Moscow, which I highly recommend for pleasure reading.

* Approximated as of October 10, 2019; based on internal data that have not been independently verified

(Edited by Evelyn Ratnakumar)

ALSO READ

How this Bengaluru startup's app helps US businesses manage franchises and multiple locations