How this early-stage venture capital firm is successfully creating a safe startup ecosystem

Back in 2012, Sunil Goyal, and Girish Shivani, were ready to abandon their steady paychecks, and Sanjay Pande, even after becoming an entrepreneur a few years ago, was ready to give it all up for a vision. Together, they wanted to create jobs for a set of people, while helping another set to invest and earn more. Thus, the trio came up with unique skill sets and experiences that would complement each other.

As a result, YourNest Venture Capital, an early-stage venture capital fund, investing in deep tech-enabled start-ups in India, was born.

Investing in Nurture Capital

Gurugram-based YourNest Venture Capital has been a part of the industry for the last nine years, with a record of funding 36 startup ventures. Girish Shivani, Executive Director & Fund Manager, added “We were new to this game and, as we now realise, we had a sense of confidence that was misplaced. We made some mistakes but learned from them quickly as well. Thus, overcoming anger, anxiety, and apprehension, we moved our investment thesis away from shallow tech ventures and focused on B2B startups in the DeepTech domain who were solving real-world problems that had global potential. Because we were among the first to do so, we also earned the trust of government-backed institutions such as SIDBI and EDF and accolades from industry partners like Preqin and CRISIL”.

With Sunil Goyal, as the Managing Director & Fund Manager, and Sanjay Pande, as the Director & Fund Manager, the team succeeded with the journey of YourNest Venture Capital, providing Institutional Investors, Family Offices, and HNIs access to the booming early-stage investing asset class.

Despite emerging from three different fields of corporate culture, Girish feels that they have two things in common, i.e., the ability to learn fast, and course-correct without wavering from their long-term commitment. “I now realise that we are the original ‘Challengineers’, a badge we give to the remarkable founders in whom we invest our unique nurture capital”, exclaimed Girish.

While describing the thought behind the name, Girish explained that a nest signifies a safe place for eggs to hatch into young hatchlings, where they get nourishment and learn to fly for proper survival and growth. They then vacate the nest for the next round of hatchlings. Similarly, YourNest is like a safe startup ecosystem where early-stage startups are nurtured and provided the skills to grow and scale-up. They leave for their next phase of growth, leaving YourNest available for a fresh batch of early-stage startups. The other connotation is that of a nest for investors where they can put in their eggs in the form of capital and see it grow into something more significant.

Now, YourNest has set for itself, a sharply defined focus to invest in DeepTech, B2B, SaaS startups, involving a list of criteria, such as:

• Idea: Should be solving a real problem, which is scalable, disruptive, and in the DeepTech domain
• Team: Should be passionate, bright, inquisitive, problem solving, adaptable, coachable, complementary, cohesive.
• Technology: Deep tech with an IP, technical moat.
• Business model: Product-based B2B model, with recurring revenue.
• Market: Large businesses should be scalable globally.
• India connection: Required in a certain form and manner.
• Stage: MVP-ready, revenue model validation done, usually arriving as the first institutional investor.

So, how do the portfolio companies seem to benefit from YourNest Venture Capital? Here, Girish added that with the focus on disruptive technologies to enhance the way, mankind leverages the value of time, YourNest Venture Capital is a US$ 75 mn fund investing in startup founders across a spectrum of DeepTech domains including AI, IoT, Robotics, AR/VR/MR, Dev. Tools, Edge Cloud, and other digital products.

“As always, our intent is to create an opportunity for Indian entrepreneurs to scale into global markets with IP-led innovations. Many of our portfolio companies in YourNest VC Fund II have secured patents and attracted customers in international markets”, he added.

Here, he specified ‘Nurture Capital’, which is a pioneering philosophy, manifests itself into an established network of professionals, innovators, business leaders, advisors, and mentors, works as unified enablers, offering the most enabling eco-system for any startup whose business is validated by customers. “Our team prides itself on identifying committed entrepreneurs with the highest level of integrity, enabling their business ambitions and helping them to scale for international markets”.

As discussed before, YourNest intends to create a global market for Indian entrepreneurs to scale into global markets with IP-led innovations. The process starts with leveraging linkages through its investors. “YourNest has linkages in diverse geographies through its partners, advisors and team, which opens doors for founders globally”, added Girish. Then guidance is available from YourNest to its portfolio founders for formulating strategy around PMF, growth, and scaleup in different markets. Here, entrepreneurs also benefit from the vast network of YourNest’s partners, mentors, and advisors.

Having an IP, patent or a strong technical moat ensures an increased entry barrier and drastically improves the chance of success for a startup in India or an overseas market. Lastly, YourNest has its focus on global B2B tech solutions built from India.

In a country where entrepreneurship is encouraged but comes with its challenges, the Indian DeepTech eco-system is rapidly evolving. Concerning that, the YourNest SOAR program, a two-week pioneering fast-track funding initiative, was launched on 1 May 2020, at the peak of the pandemic in wave 1, with the single-minded objective of investing in a select few startups, investing between US$ 250,000 and US$ 1 mn in funding in each of these startups, and being supported by several ecosystem partners like Amazon Web Services, Cisco, Intel Maker Lab, Freshworks and JioNext along with Agnii and Invest India, who committed their network, resources, and specialists to the selected startups.

Here, Girish added, “At YourNest we were clear that this was, in fact, the ideal time for passionate, future-oriented startups to be encouraged even more”.

Thus, to sum it all up, the advisory expertise in key entrepreneurial matters like strategy, compliance, legal, HR, secretarial, talent sourcing, etc, makes YourNest Venture Capital a unique name in its field. “Our ability to mentor and coach entrepreneurs of investee companies, aided by our network of corporates and individuals who can collectively multiply the advantages for our investees, makes us unique in every aspect of our field”, Girish added.

Strengthening the Indian connection

Since, the investors and entrepreneurs had claimed their strong presence and were accessible all over the internet, building a strong identity online became a major task for YourNest Venture Capital.

Besides, opting for a .in domain name was the obvious choice. “As an inherently India-focused company, mandated with nurturing home-grown startups, we were clear that we had to communicate the India connection proudly. The .in domain helps us do this without being overtly nationalistic”, added Girish.

The National Internet Exchange for India (NIXI) is helping many businesses across the country to get a .in or .Bharat domain. Enterprises irrespective of their scale and size can avail a .in domain with the help of NIXI. It is affordable and can be availed in more than 22 languages for businesses coming from all regions of the country.

Miles to go

As a pioneering, pre-Series A, early-stage venture capital fund established in 2011 to support audacious startups building life-changing businesses, YourNest strongly believes in human capability and works with the dictum of ‘what is impossible today is routine tomorrow’.

“We can now say, with all humility, that we have not just the most relevant team among early-stage VCs but also a few other strengths, including our deal evaluation pipeline, that has become the largest in India thanks to a unique initiative like YourNest SOAR that we kicked off in 2020. Also, our recent investments in DeepTech domains are already seeing traction, moving into an IRR of 35%+ as of 31^st October 2021”, exclaimed Girish.

YourNest has also launched its $75 mn third fund, focused on innovative, technology-led products, where a significant portion of the investment commitment has been fulfilled and has already started deploying funds from here. “We have come a long way, but we also have many more miles to go”, conjectures Girish.

The ‘Shaping India Inc's Online Growth’ series chronicles the journeys of startups and SMEs in India and how creating an online presence on the .in or .Bharat domain powered their success stories.