Anyone remotely interested in the startup ecosystem would know Anupam Mittal as the Founder and CEO of People Group which owns several businesses, including India’s best known matrimonial site Shaadi.com.
To use a more fitting and social media savvy term, he is considered among the OGs of the Indian startup ecosystem for having delved into angel investing (before the term was popularized) while also managing his businesses to scale. He has since backed more than 220 startups, including the investments made on reality show Shark Tank India.
Several days ago, he shared with an audience of startup investors and founders at our flagship conference LetsIgnite 2022 that startup investments were more suitable for him than putting his money in the public markets – where he tended to waste time checking the stocks every now and then and occasionally even had losses.
So when Anupam decided to share his personal journey of investment to a more intimate crowd of just investors – VC partners, family office members, and a curated list of LetsVenture platinum investors during an exclusive dinner, Unplugged with Anupam Mittal – it was all ears.
Hailing from a Bania family, Anupam was naturally exposed to a community of people building businesses and others giving loans or putting money in exchange for some equity. His own initiation of sorts in this business practice took place in 2007 when he put some money and became the single largest shareholder in a digital ad agency company.
“I didn’t know it was called angel investing…at the time about 15 years back, the VC community ecosystem was not very prevalent. That company became India's largest digital ad agency, still is, and we sold it in 2000,” he recalled.
The investment left Anupam amazed and yearning for other such investments where he could put money and in turn, get about 20X returns in a matter of a few years. Over time, the first few venture capitalists came about, ‘angel investing’ entered our lingo, clubs like Mumbai Angels and Indian Angel Network became active, and an ecosystem had developed.
Around 2011, he came across Ola (the Bengaluru-based mobility unicorn often compared with Tesla) in its early days.
“This was at a valuation that will make you laugh and then cry why you didn’t come across it. And I slowly realized that this was a class of investment that most people were missing because they weren’t part of the startup ecosystem - I was building my own startup and I was seeing this stuff everyday but most people weren’t.”
An entrepreneur himself, Anupam saw a clear opportunity in investing in founders who are building the next stage of companies which would tomorrow represent India far better than the traditional companies.
Over the next 15 years, he generated more than 45% of realized Internal Rate of Return (IRR). Anupam, who is on the board of LetsVenture and runs a few syndicates there, said the reason his investment strategies have been working so well is because his is fundamentally a people-first investment fund.
“Call it a family office investment fund or a family office-led fund and what we really do is invest in people we think are mature, in it for the long term which means they have perseverance, and very transparent people with high levels of integrity,” he said.
The Shark’s focus in India’s decade of entrepreneurship
Anupam believes that the next 10 years will be India's decade of entrepreneurship and aims to double down his bets and continue to invest as a family office.
Having backed more than 220 startups so far, Anupam noted that the bets are getting consolidated in a few sectors. Promising sectors in focus include mobility (Ola, Porter, Chalo, and Rapido), Software as a Service (FireEye and Whatfix), fintech (BharatX, Grip Invest, and Jupiter), and electric vehicle space.
“A real ecosystem is forming around EVs and we think we've picked a few very interesting companies there. In my view, SaaS is just starting to really come to the fore. Fintech will continue to build for the next 10 years and we'll continue to double down there,” he said.
Fintech fun & future
Anupam said that he traditionally thought of fintech within the framework 3Ds – decisioning, distribution management, and delinquency. However, now with fintech startups like Mumbai-based digital retail banking services provider Jupiter, he remarked that ‘desire’ has entered the fintech lexicon as the fourth D.
Admitting that bank accounts are not the most sought after products, Jitendra Gupta, Founder and CEO of Jupiter, shared that creating some FOMO among the audience and building on the coolness factors can make a huge difference. In fact, more than 150,000 people queued up for Jupiter before its launch and the startup continues to open more than 150,000 new accounts every month, mainly through referrals.
At the same time, he adds how the experience is delivered can make all the difference.
“A bank CEO called me one day and said he just cannot understand why people are loving Jupiter. He said he compared all his features with Jupiter and it's the same. I told him the only thing he did not compare is how you experience the product,” Jitendra recalls.
He vouches for the simplicity of the banking product to an extent that a customer reached out saying his nine-year-old son is capable of using the Jupiter app very easily and efficiently without really understanding banking.
Speaking on the future of fintech startups in India, Nikhil Aggarwal, Founder & CEO of Grip Invest, says that persona segmentation will be a key driver for fintech brands.
“Growing up in South Delhi, there used to be an ICICI Bank, Punjab National Bank, and a cooperative bank in the locality. They offered the same banking services but you would go to one of them depending on your income level and education background. I think something similar is going to happen in the next five years to fintech,” he said, adding that users will no longer be attracted to location but to a particular persona the bank caters to.
Jitendra believes there will be at least 100 fintech companies that will become big, reaching $1 billion in valuation.