Our job is not just money management, but also to look at new trends: Madhukar Sinha of India Quotient
Social work and venture capital may seem polar opposites, but Madhukar Sinha has successfully bridged the gap that keeps them apart.
The man who began his journey as a social worker decided to pivot his career when he was 35 and launched his own VC firm. VC company India Quotient focuses on founders with “EQ, IQ, and IndiaQ” and has built up an impressive portfolio in the last few years.
Madhukar Sinha, Co-founder of India Quotient [Image Credit: 100X Entrepreneur Podcast]
How did it all begin? Madhukar reveals that after completing his engineering course in 2000, he landed a job with an NGO called PRADAN and worked with them for four years in Sironj, a town in Madhya Pradesh.
“We were largely implementing a poverty initiative, which was funded by World Bank and the state government of Madhya Pradesh. So did a lot of things related to agriculture and construction -, built a few dams, a lot of tube wells, dug wells, and so forth.
"It was a great experience and helped me in my career, in trying to understand what are the next trends and how technology would go on to affect those people. So that was a good learning for me,” he says.
After working for four years, Madhukar wanted to explore more options of work in the nonprofit sector, but was inclined towards the advocacy and fundraising side. To make a shift in his career, he completed a management course from IIM Lucknow.
Realising the opportunity in microfinance segment, he worked as in senior investment manager at Aavishkar.
Pivoting to tech
In 2011, after receiving his first Android phone as a gift and realising the amount of things that could be done with just a smartphone, Madhukar decided to get into the tech and internet ecosystem.
“I started looking for ways to get into the main tech ecosystem and in that process, I called up Anand, my partner now... I was asking for him if he had any opportunities, or he knew anybody who wanted to hire an investment manager...That is when he said that he was himself thinking of starting a fund and would be happy if we could explore it together. I think we met for a couple of hours on a Sunday and the website of India Quotient was up the next day,” he recalls.
Founded in 2012, VC firm India Quotient invests in tech and internet companies. Its portfolio includes businesses such as Sharechat, Webengage, Fleetx, Vyapar, Pagarbook, Saveo among many others. The firm has invested in more than 102 companies and made 11 exits.
“We still don’t think of ourselves as fund managers. I think the fund manager thing only works when you are managing hundreds of millions of dollars where your job is largely doing money management. Our job is not just money management, but to also look at the new trends, try to meet the smartest of the smartest guys and somehow convince them to take our money and be in the ecosystem. [This is so] people talk good things about us and therefore good people come and speak to us and make us a part of their journey,” he says.
In this episode of 100X Entrepreneur Podcast, Madhukar Sinha, Co-founder of India Quotient, talks about his entrepreneurial journey and what made led him to launch the VC firm.
Listen to the entire podcast here
01:12 – Early life: Growing up in Jamshedpur to working in NGO
06:14 – Understanding what India really is, not only in metros, but in terms of Tier II and III cities
06:47 – NGO background stereotyping and limiting his career choices
07:12 – Completing his MBA and joining Aavishkaar
10:55 – Experiencing the potential of smartphones after getting his first 3G phone in 2011
12:32 – Co-founding India Quotient in 2012, at the age of 35
15:51 – Being more of an entrepreneur, less of a fund manager
26:18 – Not continuing what you aren’t comfortable with
32:35 – Making investment decisions for early-stage companies
43:05 – Portfolio companies like Sharechat, Lokal, and BharatAgri
50:28 – Fund return expectation in 5+ year period
57:54 – First Cheque: Investing in unique ideas that don’t directly match India Quotient’s thesis
1:02:34 – Getting personalised deal flow via founders of portfolio companies