 A warm welcome to everybody who's joined us here today for the Capital Insider. Today we're going to have a wonderful talk on the tech advantage that of course we are all seeing as we are between working from homes in between lockdowns and unlocks. And of course the tech advantage is becoming very big in businesses which are either around tech or using tech in large way are the ones who are really flourishing and could be flourishing the way forward. The VC system has been very actively working in terms of helping these businesses flourish. So if I were to give you just some numbers in terms of how the VCs have been helping the venture capitalists have been helping the startup ecosystem to grow. I came across this pain report where I realized that today there are almost about 80,000 startups in India and only about 8% are funded. So that is clearly shows that there's a large opportunity for funding of startups that is there and we've only just started in some ways. But actually particularly if I look at last year in 2019 there were four sectors which got a lot of funding. One was consumer tech. Sandeep is going to talk a lot about it because he's been a great champion of the consumer tech industry. Then there has been SaaS, Vintech and of course B2B commerce and technologies. Approximately about 35% of the total investments with several scale deals exceeding $150 million in 2019 is something that has been seen. So welcome Sandeep with Sandeep Mouti's here with us today who's a partner in Lightbox and has been leading a lot of investments across various verticals in food tech and lots of other industries which we'll talk about with us today. So if you know for all those people who want to ask questions please go on putting your questions in the Q&A talks so that we can take your questions as we go along. Interesting questions we will also give you the audio and we'll actually talk to you about it. So Sandeep welcome once again and would love to know how you are looking at things differently in 2020 pre-pandemic and post-pandemic. I mean I would not say post-pandemic we're actually right in the middle of the pandemic really. But I mean from a VC perspective how are you looking at things differently? How are you judging startups today versus how you were judging startups or evaluating startups in early 2020 now? Over to you. Thank you for having me and thank you for putting these series on. I think it's so interesting to hear the different perspectives that come about and to even share our ideas as they crystallize. I would say that look we set out with our third fund about two years ago. And one of the decisions we made when we set out with that fund was we said and as you mentioned we're a consumer focused fund. For us we said the two biggest things that were going to impact consumption going forward were going to be climate change and social factors. And we kind of looked at that from a more abstract point of view. Not necessarily your day to day questions of you know is this product right or is that market correct? It's really at a high level. If people are fighting for water they're not looking to buy jewelry or cars or or apparel. And similarly if people are unemployed or underemployed they don't have the capacity to buy the things they need. And so as we looked at the types of businesses we wanted to focus on and wanted to invest in from our third fund. We wanted businesses that were going to be on the right side of these equations. So we wanted businesses that would be mindful of their environmental impact. We wanted businesses that were going to be mindful of their social impact. So that kind of played out well for us because now if you look at what's happened as a result of COVID. I think we become I think that we're going to live with a couple of fundamental changes in how consumers think about life moving forward. I think there's going to be expectation of transparency, expectation of hygiene. And I think those are going to be factors that if you are a tech enabled business you're in a better position to provide that insight to consumers. You're in a better position to be able to talk to them about how many people are actually touching their product before it reaches you. And we invested earlier this year in a company called Way Cool that's in the agri-supply chain business. I can tell you where the banana that you're buying from the shop has come from, how many tans touched and how it got to you. Now that is going to be really valuable and important to people moving forward. So I think that, you know, pre-COVID perhaps there was, and there was by the way, and we're forgetting because in the sort of mess of COVID we're forgetting the sort of end of the party that was already starting. We were seeing that companies that had gone public in the US at private valuations of a certain level had come down radically in the public markets. We found that public investors were not willing to value unbridled growth the same way. There's a statement that growth for the sake of growth is the ideology of a cancer cell. And I think that we were very much living in that way. And I think that that started to correct and people were starting to see that the public markets had a different view on things. And then boom, COVID hit. And I think that that just further accelerated that trend toward saying, wait a second, what are these businesses really about? And by the way, always, it doesn't matter whether it's a boom or a bus cycle, a uptake or a recession, companies that have strong fundamentals, strong differentiated customer proposition with a business model that works will always find a great market. And I think that we continue to see that. So I mean, there's a lot I can go into it. This is a pre-proposed kind of COVID world. But I'll leave it to say that I do think that there is, at least for now, a realization and recognition that we need to be more aware of what is your real differentiated proposition and people are valuing that more. That being said, I'll say one more thing before you ask the next question. And we saw this before in 2008, global financial crisis hit. Everyone said, oh my God, everything needs to be different, you know, economics, everything mattered. And again, I'm dating myself in this, but since I've been doing this since 2005, I've been through enough of these cycles where the only line that matters is at the beginning, it's users, visitors, then it becomes revenue. Then as times get a little bit tougher, people start to ask about gross margin. Then suddenly you start to understand that, wait a second, maybe the financing is not freely available for everything. You start to ask about EBITDA. I don't think we've ever reached profit, but that's a separate equation. But tech companies in general don't have debt, so it's okay. But I think that then suddenly the cycle shifts again, and suddenly something else blows up and you start to feel like, wow, great, we should be focused on gross. And so it'll come back. But I think we're in a healthy, healthiest place in the sense that businesses are being evaluated on metrics that I think are important. Sure. But interestingly, in 2019, again, the VC industry had deployed almost $10 billion in capital. So in particularly in 2020, what do you think? I mean, in number terms, if you were to forecast something, how much investment do you think are going to come from the VC side? And then of course, we're only just 8% startups have got funding, so there's a lot more to be done there. Yeah. So I mean, let's just, okay, let's answer the number question first. First of all, GEO themselves have raised about $13 billion. Yeah. So, you know, we've exceeded the number by that measure. And I guess what we tend to look at is what is the concentration of that funding? Now, GEO skews the metrics a little bit, but in the past years, what has happened is more money has gone to more companies than in previous years. So while $5 billion went to $7 billion went to $8 billion went to $10 billion. What we also saw happening was the share of capital that the top two or three companies took was the decreasing percentage in each year. So that meant more companies were getting more money, which is really good for the ecosystem. But again, let's take a step back and say, look, what is the trend that we're looking at? The trend that we're seeing is, and there's this adage, software is leading the world, right? And that idea that everything is going to be taken over by something that's tech enabled. And I think that that's exactly what we see happening right now. We see that every single area that consumers are consuming in has the capacity to actually be taken over by a better tech enabled solution, whether that's in the production of the product, the distribution of the product, or the acquisition of the customer. So in some of these ways, tech is going to do it. That those 92% of the companies that haven't gotten funded. My question would be, are they thinking about how technology can be used in their entire from production to consumption chain effectively? And if they are, then I think it's a fantastic opportunity for them to actually step in and now start to get the capital. And I would argue that that's the argument that's being made to anybody who's looking to invest into India in general, that you have a massive group of consumers that are going to step into consumption and be exposed to brands in the most efficient way. Look, one of the other fundamental truths of India is we're a fragmented country. We are, whether you look at foods, religions, governments, anything, everything's fragmented. And brands by that measure have also been fragmented. So you don't have this massive incumbent in every single industry that needs to be disrupted. In fact, technology is the largest unifying platform for distribution for pretty much any product or service. So now that means that the opportunity exists to build those brands in that channel. And you can see that happening with distribution and concentrated at places like Amazon and Flipkart and next geo. You'll see distribution start to concentrate in tech-enabled environments, which means that brands will have to be built in those tech-enabled environments. Users are consuming content more in tech-enabled environments. And people are doing gym classes in tech-enabled environments. So suddenly finding that more and more consumption of content and products and services will happen in a tech environment, which only to me means that more companies need to be built in that direction. It's hard, I think, for large, let's say, semi-large companies to necessarily adapt to this world right away. And that leaves the door open for a lot of these businesses to step in. And I think that's what we're looking for. So I believe that you will find more capital coming into this market for those reasons. And if the entrepreneurs can think correctly about how they can go after that and change the fundamental economics of that industry, I think we should see a continued rise. Now, this year specifically, I don't know, it's going to be tough to call. GEO has made sure that we're above the mark already from last year. So great. That's nice for the scorecard. But I think the reality will be there will be some tentativeness. There's a lot of focus on the existing portfolio, ensuring that things that need to be short up are short up. But I think the appetite and the interest is still there. And it'll just be a matter of things needing to stabilize a little bit. Sure. And I mean, since you mentioned that a lot of businesses are now coming into tech-enabled environments, particularly, you know, I mentioned the four sectors earlier, which were SaaS and consumer tech and fintech and B2B commerce. But what new sectors are you seeing coming up? And, you know, where you might want to as an investor start evaluating startups in that direction. So when we talk about consumer tech or fintech, I think these are actually misnomers to that extent, right? We're really saying consumption and finance and edtech is really education. And so these are going after the core aspects of these sectors. So again, it's a difficult ask for me to give to you because I would actually argue that everything is open, whether I look at health care, whether I look at education, whether I look at financial services, whether I look at apparel, whether I look at house home improvement, any of these areas, and even entertainment. I mean, look at this in the last 10 days with recent bans on certain apps, there's been a massive growth in entertainment related apps that perhaps two weeks earlier we wouldn't have thought about in the same way. Now, whether that's sustainable, what that will look like is a separate set of questions. But I do think that it will, the opportunity exists to continue to change every single industry because no industry is being run as efficiently as they can be if it's not using technology in some aspects of how it operates. And I think that that's where, if I were to start looking at it, I would say, let's start at how big is the overall industry. So obviously financial services, massive industry, health care, massive industry, education, massive industry. If you can get into these areas, I think those will attract a lot of interest. Retail, massive industry. Now, within those, there are obviously segments you can cut and dice and start to get into in different ways. But I don't think the world looks different. It's interesting. Just because the internet arrived, it's not like as humans, we consume radically new things or different things. We still need food, we still need apparel, we still need entertainment. These are realities of life. And so I would say that I expect that if you look at your own personal consumption or people's consumption and look at how it's split, you probably say, okay, those are sectors that make sense to start to attack. And I think that's how we would look at it and we try to find the entrepreneurs that are solving those problems. Sure. And I mean, since you mentioned that there's so many new areas that are coming up in particularly in 2020 has like box made any investments. And I mean, particularly in the post in the pandemic times. Yeah, so we we haven't announced anything, but I will tell you that we are in active engagement on certain certain types of opportunities, many of which we started prior to the lockdown. One of the things, honestly, that we're going to have to learn is how do we assess and get comfort with the people that we're going to be working with on this journey without being able to sit down and spend a lot of time with them face to face. And I mean, this is great that you and I have known each other for years, so there's a level of comfort right away that we can step into and have a conversation on. But when you're meeting an entrepreneur for the first time, and you sit down and you say, okay, well, tell me about yourself. And, you know, you only get so much to this as nice as the video link might be, you only get so much through that interaction. And so I think we're going to have to learn a little bit about how the next crop of investments are going to be made. Or we're going to have to hope that what we have in our pipeline from the people we've met is adequate for now and then hopefully things will open up and we'll have the chance to interact. I think what the reality is, this is a people business and for us, knowing the people is what's paramount and really important. So knowing that we have a chance to spend time with them, spend time with them in various contexts and environments, not unfortunately just on a screen is going to be important. But once we do that, I think the screen has actually worked relatively well for us to manage things. But I would say that hopefully in the coming months, you'll see some stuff from us related to new investments. But it's a learning experience for other areas. Yeah, that's true. So I mean, if I were to ask you today, even for existing startups, I mean those eight percent startups life is not easy. In fact, it's tough, really, because, you know, besides, of course, the fact that they have to go back and tell their investors what they're doing. I mean, the crisis itself is quite sort of put it really into a perplex mode about how to achieve what is it that they're looking to achieve. So what how are you telling or what is it that you are telling your, you know, startups in your portfolio to hold on to not, you know, lose their focus or, I mean, just to sort of be able to stay afloat out there. I know I mean rebel foods is one of your big investments. And today, food itself is a big sort of scanner because, you know, people want to eat out or order out even from a while. I know delivery has become the go to word, but you don't want to go out and order food from outside in their homes. So, you know, what is it that you're telling your current startups to in terms of just stay strong. So, I think it was in late March. We put out a blog post which basically said double it and double it meant that whatever you're thinking is the time horizon for this pandemic whatever you're thinking is the cash flow horizon you need in the business. Whatever you're thinking is in terms of when things are going to just looking at the pole. So, whatever you think is the horizon that you need capital for double it. And I think actually at time one we should say triple it. And because I think our grip on what the world is going to look like is very tenuous. We don't have clarity on when things are going to shift and how they'll shift. What we do know though is that the underlying trends that were there before, I think the pandemic only accelerated them. Let's take delivery, for example. And we have a variety of businesses. We have Revell on the food side. We have Dunzo on the general amenities and other services side. Both have done extremely well as they were in the essential services category and were able to continue to run during this period. I think the onus is upon each company now to provide the customer the comfort as I talked about earlier on transparency and hygiene. Now, both companies are coaching it in their own ways. Revell has a platform called Eat Sure, which now talks about giving customers the comfort. I'll give you an example just to take a step back for a second. We've all lived through various terror attacks. 2611 took place. It was a horrible and difficult time. And I think at that point in time, if you asked anyone on that day, will you step back into a five-star hotel? They'd probably say, I know I'm a little wary. I'm not sure where I want to go. And I can't tell you if I can even remember a day where I didn't think about going to one because suddenly now security has become the norm. You're comfortable with it. You're confident that things are being taken care of at whatever level they need to and you've moved on with life. I think often in tech, there's always this conversation around privacy, security, all these types of things come up. Today, I imagine many people will be storing their credit card information with various service providers. Now, again, if I rewind, again, dating myself to the start of the internet when things took off, there was a big question. Is it safe to give your credit card online? Is it safe to use your credit card online? What will happen with someone steal it? Today, we willingly give it to an Amazon or to Netflix or to any of these number of providers. And so you adjust. And I think that the amazing thing about people is we are very resilient and adjustable and we have short memories. And so as much as today, we are stuck in this world where we're thinking about the concerns of ever shopping in the physical environment again, ever picking up a package without sanitizing it in a certain way. I think that there will be enough innovation and enough care and communication done by the companies in these spaces to give people the comfort around it. So what we're telling our companies to focus on, focus on these aspects. Understand what are the product and service changes you'll need to make so that you can ensure that you're on the right side of the equation. And we have businesses that run physical retail outlets as well. I mean, it's a big question. What's going to happen if physical retail moving forward? Actually, the direction of what's going to happen to it going forward is in our hands. How we determine what to say about it and how we determine how it's going to function will actually determine how consumers will respond as well. If we shut the shops and say, my God, please don't come, we're scared, they're not going to come. If you open them and run them and give them the confidence and comfort that you've addressed the issues and you do it, you actually do it. It's not just lip service. It's not this idea of just saying, no, no, it's okay, don't worry, come on in. You actually have to do the things and give them the understanding of what you're doing. I think it'll be okay. So what we tell our companies is conserve cash, invest in the things that are absolutely essential, double down on product innovation. Now is not necessarily the time to ramp a ton of customer acquisition. Customers, I think, themselves are figuring out what they want and what they need and what's essential for them. And honestly, with layoffs and pay reductions, just simply who will consume when is still simply a question out there. So I think that we have to calibrate where your product sits and for what consumer it's an essential and not. You have to understand how you're going to give them the comfort that they've saved to transact with you. And I think that's how we should spend our time right now, making sure these things are in place. Sure. No, I think those are good pieces of advice which could probably come very handy to all your portfolio companies and also to the ones who are not. It's really great advice. You know, I was just seeing the results of the poll that was recently conducted and I saw that 57% of the people said that the deal has gone on hold. I mean, obviously, they must have talked to a VC fund and the deal was nearly there and due to the pandemic, things went on hold. So what are the three pieces of advice that you're going to give to people who had a near deal but the deal did not go through? And what is it that they should be resilient about in terms of raising capital today? Well, first of all, look, raising capital is like getting on a treadmill. And I think I've said that in some form here as well in the past. Once you start, you can't stop. And so if it's your first time raising for your business, I would say really think about it now is necessary to do that. Because once you're on that, you're starting to spend someone else's money, you brought someone else into your company to share the vision with. It's equity, it's not debt, so they are entitled and you would expect that they would contribute because they are taking both the upside going forward and they're bearing the downside risk. So if you've not raised and you're in those conversations, take a step back and think about it now really the right times you need to. Now there's a ton of reasons to raise money. Recessions are one of the best times to build businesses. We know that from various stories of history. And I think the fundamental realities are there's less marketing going on. The cost of acquiring customers should be better. There's less opportunities for people. So hiring should be more effective. There's less competition in general. So your message gets to cost effectively and you can focus on your product differentiation. All of that makes a lot of sense. So if you really believe you have that differentiated product proposition, you really believe you have that customer insight that's there, then keep hammering at it. Conserve cash to focus on the areas that drive the real differentiation you need. Our philosophy whenever you raise money. Sorry, I'm looking at the next question. Our philosophy every time we invest in a company is to once we've invested start to make the deck for the next round right away. Because you want to know what is the biggest risk that the next investor is expecting you to mitigate. So if you haven't raised money, think about the question of what is the biggest risk that the investor is looking for you to have a drug and focus just on that. And if you have raised money, by the way, it doesn't really change much. It's the same question. What is it that you need to prove to get that next round in the future? Everything else to me is nice to have superfluous. It's not essential right now. Since essential has become the word of the past quarter, we'll keep with it. So focus on the essential aspects of your business, just like the essential services that are available out there. Focus on making sure that those are the things that you are improving. And those are the things that are actually demonstrating your clear differentiation. So in some case, it might be that your product's retention is much higher than anybody else's. So let's make sure that that's the case. Let's measure all the metrics in place. Focus on that one metric and maybe that's the key for the next investor buying into your business. Maybe you have the ability to acquire customers much more cost effectively than everyone else. Okay, let's focus on that. You save people money in how they actually use your product. Let's focus on demonstrating that effectively. So I think it is narrowing your focus. And that, by the way, is healthy advice at any point in time. It's just essential practice at this point in time right now. So I think that's what I would look at. Yeah, I know. I mean, again, as I keep saying that, you know, we have to find ways of survival in this crisis and any advice is good advice as long as one can apply it very quickly. So, you know, another question I would have from you is that particularly with Chinese investment, not looking to happen now. And of course, so much so that the startups today who've been coming on our webinars and they've raised some Chinese capital in the past, they've been facing some angst from, you know, people in terms of that they should actually exit it. Do you do you foresee any kind of problems in terms of startups who are already sort of do not have the advantage of funds reaching out to them or VCs being able to or they being able to reach out to the VCs and particularly with Chinese money also gone. There's going to be a little more damper in terms of raising investment in the coming days. Everything looks extreme in the current moment. And I think that in the current moment when you sit and look at it, you would say, Wow, so much capital has just been removed from the system. And sure, as we sit here today, and maybe as we sit for the next two or three months, we'll look at this and say, wow, this is really going to be horrible. How are we going to survive. But then if you were to look at the lens that says, Okay, let's say 12 months from now, or 18 months from now, we were to look back and say, Okay, what would have happened. Other capital comes to fill that gap. I think that there are there and there's a lot of money in the world just so we're there. It needs to find places for it to deliver growth. We need to demonstrate that we are a stable economy that has the potential to build and grow value through our businesses and capital will come here. So I am less worried about it. I think some companies with high burn rates that have been dependent on capital to fund that and fuel that for a period of time will have existential issues. They will be clearly worried about how they'll survive. But if you're again a business with a product proposition that's clear, you have an economic model that is based on solid fundamentals. I think you'll have the ability to adjust your model. You'll have the ability to take a breath. Perhaps your growth rate will reduce, but you hopefully won't have existential issues, which then means you're just going to wait it out until the time comes where let's say the market breath of investors suddenly increases again. Maybe it'll be filled by another geography of investors. Maybe you'll have local Indian funds come up who will be able to make a case saying that look, we understand the market really well. And we've seen new funds crop up last year itself. And I think that as a result of that, you'll see turnover in that industry as well. And you'll see expansion of the market there also. So perhaps current funds will raise larger amounts of capital. Perhaps new funds will come into the market. And so as a result, I would say that yes, it's going to be disheartening for a period of time. And yes, it's going to be challenging for certain companies that have perhaps been dependent on one or another source of specific capital. But just like we've seen in other cycles, things come back. Now, the challenge is you have to survive through it. And to your point earlier, it's all about survival. And I think actually quite honestly, there's an opportunity to thrive right now. There is a chance where if your product is right, I look, this is a pretty consistent refrain for me for the last 15 years. So if you have any product differentiation, please, if you have that, I think you have something to stand on in terms of how you can acquire, retain or monetize your customer base. And that is what will kind of set you through these times. And then I think you'll find investors like us and others who will be very interested in speaking to you. And you'll probably find that you'll get an audience with people that has the noise that's filtered down a bit that you may not have otherwise had. But I mean, on another side, I mean, as an investor, if you were to look at things, particularly, you know, a lot of exits for Indian startups came on foreign capital. So you know, we, there used to be investors in Silicon Valley or even in Middle East or China or some other countries where the exits largely used to happen even Europe. So particularly, I mean, you know, when traveling not happen, and you know, we all being more closer to home and looking closer to home at things. And you know, honestly, putting big monies on in terms of a startup without looking at his facilities as teams and etc, etc. Do you think exits are going to be harder this year versus what you've seen probably in 2018 or 2019 and of course with Chinese money also gone. Is it going to bring more impact on things. But I think exits are going to be harder. There's no no two ways about that. I think that, and look, there would have been a variety of reasons why I think it's an election year in the US. That always tends to bring about a lot of wait and watch and see what happens. The pandemic doesn't help people's concern. One of the points that I've, again, people ask the question of, so what worries you in general with investing overall. I'm worried about a lot except for sentiment shift. I think sentiment shift is the single biggest challenge that we have in general as an industry to be able to grow businesses in. The sentiment shift quite radically and quite suddenly and then take a while to settle back again to a position and what they do again they swing radically in that direction. So right now we have a sentiment shift towards fear. And that's a global sentiment shift. People don't know how to act. People don't know how to react. People don't know what to project moving forward. And so that just puts everyone in a bit of a deer in the headlights kind of position. And I think that that is a reality we have to face. And so, yes, if you were expecting liquidity in this year, it's going to be challenging. And I think it's going to have to, everyone's going to have to take a step back. Now, and that being said, the fortunate thing about India at this stage of these is that compared to let's say 2008, we've been around now for another 12 years. The ecosystem has been there. Companies have been coming here. You have multinational companies in the market. You have strategic that aren't necessarily having to get on a plane for the first time and do this. I mean, okay, again, with the geo example, in the middle of the lockdown to reach $13 billion without arguably having anyone come and visit or arguably getting on a plane and going anywhere is a testament again to the fact that okay, they are a powerhouse as a company goes. But also there's enough conviction in their overarching story of where they believe India is going. So if they can tell that story of what India is doing to a bunch of very sophisticated large investors in a certain way, I'm pretty confident that people searching for growth after this entire thing settles down. We'll also look to India and start to understand that. Okay. Underlying fundamental things are still realities. As long as as a country, we can continue to maintain an environment of positive attitude towards investment of collaboration with businesses. I think we should be able to weather that storm and we'll start to see liquidity come back. But it will be a tougher year. Okay, sure. So we have some questions from our audience. So Manav Modi is asking that how can a prototype be created from an idea? Be basic, but I mean, in today's time, how would you like to answer that? Well, I mean, I think a lot has to do with what industry you're in or what product or service you're providing. I mean, I think prototyping a software solution is a lot easier than perhaps manufacturing a product that you want to make. Which also, by the way, might start to filter businesses more to work certain types of opportunities versus others. I mean, the reality is if I can't go prototype the next widget that I want to make or the next car that I want to build is the next electrical thing that I want to manufacture. Then perhaps the areas I'm going to focus on our software solutions where I can actually get a group of developers to work on the code and put it out there. Now, again, these things are realities for today. I would also venture to say that even if you have to get something manufactured as a prototype, there's a lot of other work that needs to be done alongside that. You're not just prototyping for the sake of the prototype. You're also trying to figure out the prototype for your overall business. So perhaps there are other aspects you can try out. Perhaps there's certain testing of the customer segment to understand what pain you're actually solving if they're actually able to give you that feedback. I mean, you've just done a poll here and we're getting some certain thoughts as to what people feel about certain things. I imagine tapping into audiences to understand that, tapping into insights into what the problems are with the current product solving it. There's a variety of ways to prototype. So I guess what I would say is that if you think about it more as prototyping your business and not prototyping your product, maybe you'll find things to actually allow you to keep moving the ball forward and perhaps learning a lot more as you go along the way. Maybe in this early stage of the business before you started something is learning. And if you can find ways to learn as much as you can, I think you're making progress and moving forward. And I would focus on that. Sure. So there's another question we've received by email. It reads like that India focused VC funds raised approximately $2.1 billion in 2019. It was less than 2018, but I mean, 2020, how is it going to be for you? We keep talking about startups about facing difficulties, but I'm sure VC funds too are facing difficulties today. It's everybody is in the same business. So particularly from 2020 point of view, do you feel that it's going to be difficult for VC to raise a second or third round of funding to invest in startups? Look, I think the way funds work is they operate on vintage years and cycles. So there are many funds that were started, let's say together in 2014, 15 time frame. There are many funds that are started together in 2005 and six time frame. So you have funds that operate on certain cycles. We've seen just earlier this week, Sequoia raised their next India fund in the midst of all this, which is fantastic for them. I think that there will definitively be a challenge for first time funds to get up and running during this period. For the reasons that we've just talked about, you can only get so much out of the screen. And so if you're an LP meeting fund, they have the same kind of assessments that they're trying to make about investors that we're trying to make with entrepreneurs. So all of those for a first time fund will make it much more challenging. I think if you're on a repeat fund and you're looking to continue to do what you said you were going to do and you can talk to sort of why things are working or what hasn't worked. I think you probably get a good audience with your existing investors and there's still a chance for it. All that being said, I think to the point that 2018 and 2019 saw a lot of funds get raised. Probably just means that in general 2020 isn't going to be a large fund raising you either way. And so people have powder, they have capital that they can invest. And I think that bodes very well for entrepreneurs. So there are funds sitting on money. There are funds that have been in the market for years. Again, versus 2008, let's just look at it that way. We have so many funds that have been here now for anywhere from let's say five to 10 to 15 years that have these limited partner relationships that they can call upon to be able to get the capital that they need to be able to fund the companies that they'd like to. Now the challenge though for everybody at a macro level is when is India going to deliver the return against that. And I think unfortunately 2020, while we had hoped that it was going to be a year where a lot of those questions were answered, probably going to have to wait another year or so for us to really see that. And that will be a question that will weigh for everybody. And but look, like I said, there's enough capital in the market. There's enough people, us included in that that are willing and interested in investing in businesses. So as an entrepreneur goes, I would say your, your, your market is still open for you and you should definitely be out there talking to people. Sure. So we've got another question from Chirag. Can we give the audio to Chirag? Unmute Chirag please. Chirag please unmute before you ask the question. Okay. I should ask the question on his behalf. Okay. Okay. Chirag, are you, are you ready to ask the question? No, I don't think so. Okay. Go ahead. I'm having some problem with my audio. Yeah. So my question was predominantly on what are your insights or what are your thoughts process and how the real day landscape is going to look like currently with the current, you know, with the COVID that has happened. Do you see businesses moving to a hybrid model? Or do you see businesses taking the electricity and online presence? If you see it in the developed world, quite a few brands have kind of, you know, fired the bankruptcy or are kind of looking at shifting the business model more geared towards the online presence. Do you see a similar trend taking place in India as well? So look, I think in general, we've said that the pandemics accelerate underlying trends. We were already seeing your growth in online commerce overall in the market. So I think if anything, you're going to find that this shift has opened people's minds out more and more towards being able to buy different products online. And we have a business called Bombay Share Company in the Aparo space that operated actually 16 physical retail outlets. And we also had an online presence. I can tell you that we are categorically more focused on the online part of the business today than we will be on the offline side of it. And so I think that you will see a shift just because there's an opportunity to do so. We always expect, and our reason for investing in that business, by the way, was because we expected to invest in the tech that would allow us to grow it in an online manner. Not dissimilar to what we did with Rebel as well in the food space. When we invested in Rebel, they operated 60 restaurants where people actually walked in. 90% of the revenue at the time we invested was from people coming to their restaurants and ordering. 10% was from people phoning and getting delivery. Today, 100% of the revenue is all through apps and all through cloud kitchen. So that was a trend that took place in a shift that we enabled, independent of COVID. So I think that the answer to your question, at least from my lens, is to say that this was a bet we were making in an area, a direction we were investing in even prior to this. If anything, just accelerate it. And I think that you will find that more companies will understand what a offline channel can be useful for and use it in that manner for what it is. And invest in ensuring that the technology they have allows them to reach a broader base to customers in an online environment as well. And it's going to be supported by so many people in the ecosystem. I mean, what's amazing, and I know this wasn't your question, but I'll just bring another point into this. What's fantastic to see is the capital coming to Geo, combined with the commitment that Amazon has to the market, combined with the capital that Walmart Flipkart has available to itself, ensures that they are going to invest, combined with, by the way, Google and its focus through payments and that infrastructure layer, shows that there's going to be a massive amount of money spent on bringing customers into a technology-enabled environment to transact. As a brand or as a retailer, I want to take advantage of that. Because it doesn't matter. My store might get put fall in and it might do well, but there is no way it will ever match up to the sheer volume of people that I could reach online. And so it would be foolish for me not to consider that and not to take advantage of that and not to build with that in mind. So I think you will see a shift in the landscape. Retailing in a physical environment won't go away. It will change. Perhaps it won't be the focal point for many people going forward. Perhaps mom and pop shops will thrive. We have another business called Denzel, which actually helps mom and pop shops actually ensure that they're meeting customers' needs in a world where Amazon and Flipkarts and big baskets of the world are providing a different type of service. So I think that there will be some settling again of the system that needs to take place. During that time, if I were to look at it, I would invest in the technology backend infrastructure to allow you to be able to compete effectively moving forward. I think there's another question that's come about Chinese money. Do you think that the Chinese money will... Okay, we can give it to Saurabh, actually. Saurabh is online. Saurabh, if you can unmute. Yeah, go ahead. Yeah, hi. So my question is that you said that Chinese investment will get replaced by money from elsewhere. There's a lot of money across the world. And you talked about reliance. Reliance is a behemoth. We can't compare it with startups. And when you look at the overall economy of the country, it's going to contract. I mean, it's official. And the ratings agencies have also downgraded India. So you really think that money from elsewhere like pension funds or other money can head towards India? So look, I think that things are cyclical. And you're absolutely right that the reality of the world is that the world will contract right now. And, you know, we've gone back and looked at the previous variety of crises, including 1918 and the Spanish flu. And you kind of realize that the things that broke things open at that point in time were actually tech innovation. At that time, I think it was the washing machine and the car and the very basic things that kind of got people to say, I want to spend on this thing. And that opened up the market in some way, shape or form. If I think about India moving forward, I think there's a lot of chaos and inefficiency that's intrinsic in our system. It's just a function of being a very large country and having grown very organically in that manner. And so as a result, there's massive opportunity to improve in many areas. And whether that's going to be in the future in terms of electric vehicles and the role that they play, whether that's going to be in city planning, aspects of it and things that might change their health care in different ways, there are basic fundamental services that people are going to want. And I think even now, let's just take education, for example. We've seen in general a need, forget a willingness, a need for students to have to learn through Zoom classes. My kids are going through this day in and day out. And suddenly what would have been thought as sacrilege to have a kid in front of the screen for four or five hours a day being taught is now the norm. Now, what that means is perhaps when schools reopen, certain schools reopen, but perhaps this model will now be better understood and accepted by a broader range of people. And so I'll get to your question in terms of other capital coming in, but it starts with ideas first. If we have ideas that we're able to make a case for why they make sense to invest in and grow, I think capital will assess that and decide whether or not it makes sense. So it starts with an entrepreneur saying, listen, this is why. In fact, I can change the face of education and reach so many people and build an interesting business, which then comes to an investor who says, wow, that looks interesting. We need more money in this market because we're finding more and more of these opportunities interesting. That story then gets pulled back to a bunch of pension funds, foundations, surrounding offices around the world, who then look at it and say, hmm, okay, seems to make some sense. If we're not ready to tell those stories or explore those ideas, you're absolutely right. If we're going to pick up and the phone and say, hey, is anyone in India looking for some money? That's not going to happen. There has to be people that are looking to build interesting businesses and change the market. And then absolutely, I think capital will come. That's how it comes so far. So I would say that that's what gives me hope because I do still see over 100 plans a month that come into our system that are interesting. And we see more and more of them continue to come and they're by entrepreneurs who have lived the journey now. So I think we are, we're in a healthy place. We just need to now get those stories synthesized, get them out there. And I think people will be aware. And India is not this unheard of area. People have seen it, they've understood it, they've understood what works, what doesn't work. Some people are still perplexed by it and are still trying to figure it out. But it's up to us to tell those stories. So if we can tell those stories well, I think we can get the attention we need and the capital we need. Sure. So there's another question that as an investor, are you suggesting M&A route to exit for your portfolio of companies with startup funding down by almost 29% in the second half of the year? Is this something you can say? M&A is always an option. And M&A is always a reality. So China has their massive large guys, Baidu, Alibaba, Tencent, Xiaomi. The U.S. has pick and acronym, FANG, GAFA, wherever it may be. They have large companies that are known to be your super consolidators. As we've thought about the Indian market, we have our own acronym for it. And that's Mr. Fatbub. And we say it's Mr. Fatbub because the M can stand for any of the number of Indian companies that might be there. Make my trip, for example. R could be a reliance, for example. S could be a Facebook or a Flipkart, for example. A could be an Alibaba, or could have been. Let's say it's an expense. So the fact is, the M&A landscape in India can be very broad. Because we are, have been largely an open market that has allowed for many players to want to come in. And many players will be interested in acquiring companies that actually add differentiated value to their customers. So yes, we've always believed in M&A as an option. We've also fundamentally invested with the idea that a business should be able to stand on its own. So we are building with the intent of being a freestanding company. However, we are actively always considering what the options might look for for M&A. You know, I got a question for an email. And I have, so a brand asked me this, that, you know, is there a possibility for a startup to come and put an app for a market? I mean, let's say in Delhi, there are, you know, hubs. For example, there's a South-ex market and there's a, there's a cannot place market in which there are different brands. And people typically tend to go to these brands at least they used to in pre-pandemic days to shop. So is there a possibility of having a startup or an opportunity for a startup to be able to put an app which is actually more regionalized and in one sense really a hyper-local to be able to meet the needs of the customers in that particular region or area from those stores? So absolutely, it's called Danzo. Yeah, I know Danzo. That's exactly what we've done. Putting their data, it could mean taking the data, putting it on that app and actually being able to show their merchandise and show their content. In fact, you know, I'm, that's one of the reasons why I'm asking you this question because I know of Danzo. But you know, for Danzo to actually do it across all markets to that extent, do you think it needs to be regionalized or do you think it should be done by one large startup? So look, I think there are a variety of companies everywhere that are working to bring offline players online and bring them onto a platform. If we're now saying let's get the con market community of shops onto one app so that you feel like you're going to con market, I'm not so sure that that's necessarily the same metaphor that needs to translate into an online environment. You probably want to go to the two or three shops you go to in con market and you're happy knowing that those are accessible to you. You're not necessarily interested in dealing with the chaos of the traffic and replicating all that in your online experience. You simply want those shops. So I think that maybe indexing them, searching for them, being able to categorize them by certain locations is useful and that can be done by a variety of players. And I think that you'll start to see that. And I think that that's what will be necessary for the offline smaller brands that have the opportunity to actually continue to maintain their uniqueness and their presence is to ensure that they are accessible in an online environment and are known for the things they're known for. If you're known for being in con market, okay, but I assume you're known for your products that you sell. You're known for a certain set of things that you have. And so I think that, yeah, we'll see that stuff happen. But I'm not sure. I'm not missing. And look, the great thing about entrepreneur investor discussion is that an entrepreneur will convince us why that market exists and how that should work sitting here today. I don't see it off the right off the top of my head, but I'm happy to be pitched and told them and explain to why it works in a certain way. I think the question actually came came from a consortium of retainers in South Hicks to me saying that, you know, if there was a possibility of a startup to be doing that. So I think, yeah, I mean, it could be a good possibility for at least South Delhi to be able to have its own app where they can just shop from their whatever local shops. We have, I think we need to get one last question. It's a bit specific so you can choose whether you would like to answer it. This is about your investment pieces for rebel. And Chirag is saying that from my understanding the unit economics may not make sense, because the orders are actually being placed on Spiggy or Zomato. So, I mean, you know, he's really talking about the maths of cloud kitchens. Sure. I guess the simplest answer is they do make sense. And I think I can, I can assure you that neither would with the company of neither we've invested nor would they raise as much money as they have subsequent to that. If in fact we weren't able to show that I will say that look every retail business has and let's just let's just take for a second an offline analogy. Someone runs a mall in the mall. There are shops. Some shops will do well, some shops will do that well. And I think that's it. Swiggy and Zomato are a mall. We are a set of shops that run within them. And we've understood how to run efficiently in that mall. And I think that it might be more challenging if you're a smaller player. So, again, let's take Zara as a large player in any mall will have one set of terms versus a smaller shop, which might have a different set of terms. Zara will also make a larger commitment to real estate will make a larger commitment to orders and all those types of things. So scale helps in different ways. And I think that with rebel, we are now definitely at a scale that is beyond anybody here in India and actually going on to be on anybody globally, as it relates to brands owned under a platform operating this type of a business. So, I'll tell you that the math works extremely well. Also because we own our brand. And therefore we control the entire supply chain. So this is a big learning that we've had over the past years in businesses like Malora and businesses like for Lenco and businesses like rebel, where we are full stack operators. We've understood that owning the manufacturing process in somewhere controlling the manufacturing process is essential to be able to ensure that you're capturing the right amount of margins to make the economics work. If you've looked at a food model and you thought about the economics in a certain way, perhaps you thought about it from a sub scale perspective, or perhaps you thought about it from a perspective that doesn't have enough deep supply integration to get the advantages that we get that. Sure. I mean, just from my understanding when you say that you control the manufacturing process. I mean, once you think the cloud kitchens will start becoming big enough. I mean, and I mean, you know, into the likes of the size of tomatoes and swiggies. Do you think they would also want to control the distribution process themselves. I mean, like Domino's did in India with a 30 minute pizza delivery and so on. So today we operate about 300 cloud kitchens with I would say at least eight brands of scale on the network. I think that replicating that scale. And remember you're making food, you're making food in a distributed manner across the country where again we're not known for a very high level of consistency and supply chains to be able to ensure that. And also, by the way, consumers, I think will want more and more flesh and less packaged processed food. So to be able to facilitate that to enable that type of a system to work. It's complicated. And if you have an existing business, if you're swiggier the matter that's involved in distribution. If you're the, again, let's take a very simple model operator. I think tomorrow becomes our just because you operate a very large mall doesn't mean it's any easier to become that. I mean, it's a very different business, making food, making recipes, designing menus. All of that is a very different business than necessarily running a network of delivery partners around the country. And so I think we have a very symbiotic relationship. And I think that's probably healthy for the ecosystem overall. And I think if I were to say, I take away out of COVID is that I think places where people thought they should compete or could compete. They started to realize they probably are better off partnering and working together. And I think this is no different. And we have a good relationship there. And in many of our other businesses, we found that places where this question may have risen saying, could that distribution partner or could that supply partner become a competitor in some way. So to realize that they're not interested anymore and they see the benefits of what we provide. Sure. Thanks for talking to us. And you know, before I actually conclude this, I would love for you if you can tell us what are the four consumer tech areas that you are looking up in 2020 in terms of, you know, most promising or most emerging and therefore you might want to look at as an investor in those areas. Okay. Look, I guess I before I tried to dub this question, so to speak by saying that everything's interesting. But you push to narrow it. Look, I'll say that I think that health care continues to be interesting. I think it's a massive problem. And I would I would focus on that. We have not found the right thing in financial services yet and I'm not saying syntax and think financial services. So I would say that that continues to be interesting for us to learn and see what is the right type of business for us to get involved in there. I think that, and I don't have the right answer on city planning and city management of traffic and people in some way shape or form. In an ideal world, I would say a ways equivalent and what they were able to do is helping people understand traffic. If we can find the software solution that does it. That would be interesting to think about. Finally, fourth one is a difficult one. I mean, it's a simple one to go back to education. But I think that it's, there's got to be a lot done there. And we've been fortunate enough, we invested in imbibe and imbibe is now part of reliance. And they're doing an amazing job with that. So we'd have to really make sure we found an area of education that I don't think is effectively being addressed by some of the larger players and then try to go into it. So there's four. Interesting times we're heading into and I particularly the kind of pitches that we've started receiving they look so much different than the kind of startups and pitches we used to receive back in 2019. So we're essentially moving into very changing times and new kind of businesses. As you mentioned yourself, I've seen your previous presentations and that's why I was very keen to ask this question from you for you to sort of give me a grid as to what the new kind of consumer tech companies are looking like. But thank you again for talking to us your vision and your insights are always very useful and they always provide a great learning opportunity for everyone who's looking to start up or you don't think from a start up to a growth state. So thank you for talking to us here today. Thank you. Thank you for having me. And for all our people, if you have more questions who are attending here either on zoom or are attending us on Facebook live. If you have some questions, please put it there in the comments box and we will make sure that we will get the answers from you. The answers are sent to you. We will ask in the steam if they can take a few minutes to actually write down these answers and send it across to you. Thank you once again, Cindy. Appreciate you being here today.