 Mr. Pankaj Makar who is heading the Bertelsman fund here in India and he's going to be in the late stage fund and the growth stage fund it he's going to tell us about how funding today is working in particularly in late stage series we've earlier talked to a lot of early stage funds and we've seen that there is while there is some slowdown but also at the same time there is some growth that is happening but the equation is very different when you are actually talking about a series B and a series C funding happening for a startup they've made various investments in this country largely Bertelsman has always been focusing on digital startups in whether it is in consumer tech or whether it is in B2B space of course Pankaj is going to enlighten us more on that but the most recent investments made by them include the e-commerce frozen meat startup which is Licious, Roposo, Nets Transport and the Etik company Aeroditis. So thank you for joining us here today Pankaj you know things have changed I mean today things look much different from you know January 2020 to June 2020 it's almost like we're gone into a different world the way we work and the way that the regime of you know how we conduct business has totally changed so I would love to know and if you can tell our audience as to what has changed particularly from a VC perspective how it is how is it that you're perceiving investments today or looking or evaluating startups today are you looking at some new sectors or are the similar sectors which were there earlier only continue to be your focus? Sure happy to answer that and let me start by thanking you Ritu for inviting me to this conference it's a pleasure to be here and while we are all working out of our home and I have this nice virtual background at my back things are different and things are difficult times are tough and then I think there's no two way about it but within that I do feel that there's significant amount of resilience in venture capital in India and all of us tend to be mostly optimistic people so we do think that such time will pass and a lot of our companies will do well and we will have plenty of opportunities to continue investing because India fundamentally continues to be a fairly attractive market from a venture capital investment perspective. With that kind of you know comment your question on what has changed and how are we looking at investments we are cautiously optimistic about the situation we are cautious because number one this is a very tough time for the country for society as a whole and the first kind of steps that we made during this pandemic was to make sure that our own people our staff our families their families as well as our investments startup founders the teams that are working with them continue to be safe the whole ecosystem whether right from a delivery boy to a warehouse person to a CXO sitting in a in a corporate office he's safe his family's safe I think the first fundamental task that all of us have as human beings is to make sure that safety of our near and dear ones are taken care of. The second thing of course is then comes about investments right. We continue to explore investments. We first need to make sure that we invest in our own portfolio companies to make them more resilient and get them to focus on building value either during or after COVID and lastly kind of think about how to make new investments in areas which might be exciting whether it's health tech or otherwise and we can talk more about it in the conference but that's the kind of framework I would kind of think about thinking about ourselves health society as more human beings and then thinking about life as investors which I think is probably the more natural way to do. Yeah I totally agree I mean you know first of all we all need to be safe before we can make investments and really conduct businesses but life goes on and I mean I think the government also in one sense has said that you know move on I mean we'll have to learn to live with it so therefore that's what we're doing but I know I mean I do understand Pankaj that you know you're a late-stage funded person and obviously your entire focus is right now to also navigate through your own portfolio currently because the companies are fairly large in which you have investment so what is it that you are advising your current startups in terms of how they should be staying afloat holding on you know obviously a lot of sectors like particularly if you look at shared economy startups, co-working spaces all of them have taken a setback today so I mean particularly and while I know that you don't invest in such startups but I mean overall both from your portfolio's perspective as well as for a perspective of larger startups who had a significant business but is facing adversity today what is your advice to them what are you telling them? I think this is something that I've kind of said it in a few more conferences before and this is an advice that I genuinely believe does help entrepreneurs and all of us create some kind of a structure on us the way I look at life and I tell entrepreneurs about is to break this entire pandemic into three phases phase one is what we are in currently which is fundamentally cases are rising up we are in the middle of pandemic the peak is not reached and we want to make sure that we think about number one life as I talked about it life for our entrepreneurs their teams their families make sure that work from home works and on the one hand in the second hand think about business continuity stop thinking about losses whether they're increasing by 10 20% 30% sales are going down by 50% 60% all of that are external events and you can't do much about it just make sure that business continues now business can continue by a function of two things number one you have the capital and the resourcefulness whether it's the team which is kind of delivering that business around it make sure that you offer you have enough capital as well as a team and operating model through which you can function that phase two is when you know hopefully in August September when the peak is there and then numbers start to decline sales start to come back consumers have confidence to kind of buy products again at that point start your digital marketing spending again start optimizing on lost time last lost opportunity lost sales and use the dollars that you saved in phase one to bring back your business in phase two right I'm thinking about phase two and you're implementing phase two start thinking about phase three which is are you going to be a net positive of COVID are you going to be a net negative or are you going to be a net neutral of COVID for example by virtue of let's say e-commerce company which fundamentally is a contactless business you might see that consumer behavior has changed wherein you're you would end up getting a lot more demand once this COVID pandemic is over and you need to equip yourself for it or on the other side you could be a business let's say you know some of the mobility businesses that you talked about which might end up to be net negative and how do you you know sustain yourselves for a much longer period of time so that once that effect also goes away after phase three you have a business to to build or if there are other adjacent categories that you can venture into early on then think about those things so I think depending on where you sit on what sector and in this scale from neutral to positive to negative you can chalk out your strategy on a post COVID phase three period right and I mean you know if I were to just ask you this from a VC perspective I mean what kind of resilience is our VC is looking at I mean you know I'm sure there would be some shakeout in the VC world as well so what what do you think what kind of filtering is going to happen in the VC sector look I think the VC sector honestly is a very long-term business most of the people who raise VC funds raise for a 10 to 12 year fund so I don't think one or two years will see a massive shakeout yes they may end up seeing massive losses but those losses will not get materialized and the effect of all of that will not come in for the next three to four years so yes whether some of these VCs end up raising new capital yes some of that may happen and you can call that a shakeout but whether their existing funds will die immediately that we have not seen happening very fast sure but you know that there are of course very I mean angel investment is likely to be hit so the the whole cycle of investment sort of comes in under a bad lens because you know the early startups are not able to move further and then you know series pre-series a in the series a so do you feel this entire chain is likely to get impacted somewhere or for investments so I have a certain point of view on how some of these early stage funds or mid-stage funds and we call this as a mid-stage funds I used to call myself as late-stage fund as you started calling me in the beginning of the chat but I realized that now there are much larger players who come after me so I now call myself as a mid-stage fund rather than a late-stage fund so the definition is changing very fast so the early stage funds which do seed and a then there are mid-stage funds to do to B and C and then there are late-stage funds who may do DEF or private equity or or pre IPO deals and and so on soft banks and NASPERS and others of the world all the private equity guys whether it's TPG, GA taking investments and tech companies will be late stage guys so my general view in the segment is that as far as early stage investments are concerned investors are concerned I feel that while individual angel checks may take a hit because people have suffered losses in their core businesses there is a significant amount of institutional dry powder that exist in pre-seed and seed and series A rounds right and whether it's very Maki funds like Axel Zacoia and others have raised large funding rounds they will make sure that this business is fairly well taken care of these stages and at some point they will become fairly active the reason why they will become fairly active is when they six months to one year to build technology if they are using this time of COVID to build technology it's the best thing to do because none of their other competitors who are building similar technology can launch because of COVID so in my mind it's a perfect time to seed and give series A monies to very early startups sure and I am sure the institutional investors will take advantage of that so I do feel that in the early stage the momentum will continue and all the people who are watching this kind of conference should take comfort that a lot of early stage funds which are not which is not me but a lot of the names that I mentioned should continue to fund startups and that's a very positive sign when it comes to late stage investors given the check size that they are writing are fairly large they would of course want to focus on quality of asset because of the higher risk they are taking my virtue of their ticket size and that is where we will see a significant flight to quality as far as late stage investing is concerned so if you talk to any late stage investor they will say okay which are the five sectors which will have a positive impact coming out of COVID it could be healthcare it could be education it could be e-commerce it could be a couple of other sectors and let's make sure that we find the best assets in these categories and fund them and we might see probably overcrowding in a few assets because of that the mid stage where we exist would kind of this is the most tricky part this is where you can't decipher whether the opportunity is real or not because COVID can either mask that opportunity or make it look good or bad so I think this is where we'll see the least amount of deals happening now which is why I mentioned that I am cautiously optimistic because I know the future is great but very difficult to decipher mid stage deal at this point sure but you know as I say crisis always sparks new innovation so where do you see this innovation happening you know any kind of depression or economic or I mean this is of course a different kind it happens or takes place there are new kind of businesses which suddenly crop up and while you mentioned about education because education was somehow a tech wasn't one sector that was not being able to take up because of so much conventionalism in the traditional education sector but suddenly we've seen a big spark happening for education but I mean apart from that where are you putting your pets on or you're looking closely at some sectors which you feel could be investment worthy so we think that almost all the trends which otherwise would have happened in consumer behavior have gotten accelerated so whether it's e-commerce which we think we would have read somewhere by 2025 we might be there by 2022 just because consumer finds is more convenient and less risky to buy products on online versus offline think of you know FinTech I know it is a sector that most people say should not get invested because it is really going to be a problematic sector our kind of thesis is slightly different we feel that in the last 20 years NBFCs which are offline NBFCs have built a large business because banks were not paying attention right now in FinTechs tried to build the next stage of businesses because NBFCs have become too large and they were not innovating now because of COVID and also the resulting economic issue that's going on in the country there's a chance to actually get FinTechs to work very closely with banks and bypass the NBFCs because at some point while the banks got a short change in the early 2000s and until 2015 etc because NBFCs were able to build a business which banks ideally thought was theirs now that there's a chance where banks themselves can be innovative by working directly with FinTechs I mean we see that in for example a company where we invested recently Rupiq does that very clearly by working with various banks and so on so I do think that there are various opportunities that may even emerge where bypassing of certain intermediaries will may happen and companies let's say FinTech within that may emerge as victorious if they continue to work very closely with the actual capital providers which are banks and so on so I do feel that there are slivers of opportunities and mostly all sectors outside of a few which of course are contact sectors and of course the very basic stuff of healthcare and e-commerce and education of course will see massive tables. Sure and other than FinTech what all sectors are you looking at more closely? Look I think that D2C is a very big sector I mean it's just investment we made over there we're quite excited about that theme in general and again the background of that is we think that India is a brand starved country as people have more consuming consumption power and they'll spend they will want quality product and at the same time there are large distribution platforms that have been built by virtue of Amazon and Flipkart and now Geo entering system and so on and once the distribution platforms are set there is an opportunity for new products to ride on those on those distribution platforms and the next generation businesses in e-commerce would be D2C brands. Right. So I think I want to challenge the existing FMCG brands. Yeah I think that's the idea look Millennial users behaviors are very different going and building a brand online is very different distribution platform look earlier if you had to open up a Levi's jeans type of business you would have to create 200 showrooms across the country and then you will get some amount of distribution today you can do one tie up with the Amazon or Minthra and you are done. So the cost of doing business for new age brands has come down significantly and if they are attacking white spaces that exist within this entire brand spectrum you can build fairly valuable business in there. Sure and I mean do you see I mean since you mentioned D2C do you also feel that the B2B side of e-commerce which is like social commerce or live commerce is it something that is going to take off and I mean not just pure play e-commerce itself. Yeah no I think all categories of e-commerce which are contactless will grow. In fact whether it's companies like Misho or it's logistic players like Shep Rakhid as a product company all of them will see massive demand coming in because people who are fundamentally offline or even consumers buying offline will move online now that could be on social commerce that could be even on Facebook Instagram it could be on individual sites or it could be large platforms will see emergence of all of that coming very strongly we always thought that that was coming but but this has been accelerated significantly. Correct. Yeah I completely agree with you. Let me ask you a more educational question now. I mean you know I always wonder what is really the difference between a series B and the series C investment. So you know I mean how do you differentiate it as an investor. Looks series B and series C fundamentally are similar in risk. So the best way to look at different series is to see what risk you know an investor is taking when you look at series A or C the risk profiles are somewhat similar when you look at series B and series C the risk profiles are somewhat similar and risk profiles of B and onwards become very different which is why there are different classes of investors that have been formed here. For me a series C is a slightly less risky investment than a series B investment that would be the difference. So normally would you when you invest in startups you would invest in the same startup for series B and also for series C. Sometimes we invest in series B and sometimes we figure out that the company has raised a series C series B but the risk profile is significantly higher than what we would ideally like to choose. Right. Wait for another round and do a fresh investment in series C wherein the risk profile is a lot more palatable to what we want. Sure because issue is not check size. I mean a lot of people define series by virtue of check size and the sequence. A lot of people also define series by virtue of valuation. We define the series by virtue of the risk profile of the company. Sure. But since you mentioned valuations and I mean particularly at a series B series C stage do you think it's a it's a good time in some way because the valuations are more real. You know honestly for a good asset we shouldn't at series B series C we should not kind of expect lower valuations. We should always expect a fair valuation and again fair valuation is a range you can be on the lower end of the range and that's that's positive. But no I think if you're looking at very few assets like like we do we are happy to play a market price than to look for bargain deals bargain deals also result in a lot more failure because then there's fundamentally something wrong with that's why you're getting a bargain and we would not want to kind of get a you know an average asset at a lower cost versus a great asset at a fair value. Sure and I mean while I completely agree with you but do you think that's what really happens in the market also in terms of the valuations. I mean it's always said that you know at the series B series C level they're always overvalued it. So yeah I didn't get the question do you mean we are more value conscious is that the question. No I'm saying that you know it's it's normally I mean even if you look at a few years down look at examples of Flipkart I always felt that they were overvaluated and that's what the market perception was to when they were on their series C series D kind of levels. Well they did have a twenty billion dollar outcome so probably worth it right. Yeah but no exactly that. So I mean even if it was overvaluated doesn't matter but I'm saying that right now do you think the valuations are more real. I think for quality asset that they're still on the higher side for everybody else it seems like it has moderated significantly. Sure and do you think therefore it's a good time for you to make investments in that. I think given that we only want quality assets for us then the price is not coming down significantly at all right. We just get an opportunity to easily enter an asset. I think that's a positive and that's a very big positive when it comes to mid-stage investing by the way and I do think that that's something that we would like to try it on as far as 2020 and 21 is concerned. I mean so you know I mean I've seen that you've always been at Buddlesman you've always been not over ambitious about investing in too many startups you've been more cautious and you use the word cautiously optimistic but something that you have always been even when you know there were the best of times for the entire sector but you've still been cautiously optimistic. Do you feel that overall I mean what kind of strategy do you work with when it comes to investments you think differently than the other investors. Yeah I think that is true we are perceived to be relatively high I mean this is what some of my venture friends have told me that it seems that Buddlesman is very conscious of quality and his high quality and less investments etc and hence your risk bar is you know fairly high and I keep reminding them that look in our business it's very easy to make investments very difficult to get risk returns so please don't tell me how many investments have I made in a year tell me how many exits have I made in a year because that's actually when you make money. So given that the poor track record of exits we have in the country I would actually urge everybody to be slightly more cautious. But I mean now that you're talking about exits what do you think is going to be exit scenario now. I think it's going to be very difficult. Most of the businesses that we have seen getting funded are very low margin commoditized businesses where capital has played a significant role in building significant scale and till we see sustainability in those businesses we will not see exits either as IPOs or as the strategic buyers wanting to buy them of course secondary exits by virtue of a larger VC or PE player buying out other people is always possible but look as Bertelsmann we have lived for 185 years we want to live for another 185 years including on so many COVID type situations. We take away long term year for us the real exit is when companies become sustainable either IPO or IPO or strategic buyers end up buying them and actually find value for them for the next 10 to 20 years that's a good measure of what a good success is or a successful exit is. We see very few of those in the Indian market because I just generally feel it's not a question of the assets are also a question of the mentality of you know most of the founders and entrepreneurs and probably we picked ourselves to wrong measures. We need to kind of fix it over time and hopefully crisis like these will help us kind of realize that we need to build sustainable businesses rather than just high growth businesses. And I mean given the fact that you are a global organization so you have presence in Brazil and in China and of course the company itself is German. Do you think exits are going to now happen across different countries. I mean I mean for example an Indian company getting an exit from a Brazilian fund or a European fund. Do you think that kind of thing will happen now or do you think your funds internationally are going to be more cautious and only going to play in startups which are closer to them where they can travel easily meet each other in person and so on. Look first of all I do feel that COVID in our life would be a one year worst case one and a half year phenomenon. And I don't want to talk about investments which I really would have panned out for a five to 10 year horizon for this very limited period of time. So yes some exits may get delayed some people will find it difficult to travel to India to make deals but that's kind of true for all geographies around the world. It is not unique to India. So I don't think anybody will hold the Indian VC system or a startup system to hostage for that. But I do feel that if they are quality assets we will see good exits coming in once COVID is over let's say in 2021 then 22 onwards IPO and IPO windows will also open up for sustainable assets. We have seen significant amount of assets which were backed by private equity coming for IPOs in the last three four years before COVID. I do hope that some of that happens on the venture capital side as well. Sure. So we just got a question from Facebook from Mr. Merchant who says are you investing in the entertainment sector in some kind of self creating itself curating content? Honestly, we are investing or we want to invest in all assets which are okay from our risk criteria, whichever sector it might be. The criteria for us are four or five that we look at when we assess risk. Number one, we want to make sure that the founding team is complete and they have either done this business or in the past or they are doing this business for a long period of time so that we know that there's no risk in terms of the knowledge and capability of the teams concerned as far as the business concerned. We also want to make sure that the product that you have built is aspiring leader in extremely large category so that large outcomes can be built and it is already a number one product in that market with number two either not existing or existing at a very small level. And thirdly, it needs to at least have significant product market fit as well as monetization so that business model and unit economics are not in question, which ideally for us is more like a five to ten million dollar revenue business. If all of those risk are taken care of, what are the risk that we are willing to take as series repairs? We are willing to take that. You will continue to be number one player in the market and your number two or number three player will not come and kill you. We will take a macro risk of whether the sector is investable. We will take a view of whether you can execute it to a large business and the last risk that we'll take is whether we can exit out of this business proper to me. So provided you can solve and show us that the first four risks are taken care of and the next four risks we are willing to take with you as partners on your journey. Any sector is okay for us not just editing it. Leto, are you there? Hi, Pankaj. This is Puneeta. I guess there is some connection issue which was happening. I think she's back. Okay. Sorry about that. I think the connection just lost itself on me. So you know when one thing we were talking since we were talking about the global play, do you also see an opportunity for startups moving between countries? I mean, do you feel that, you know, since you have offices all across the world, do you see that, you know, you can take an opportunity from one country to another country and so on. We actually do. Yeah, so we would love to do that. By the way, in China, our fund has a very which I don't run. Some of my colleagues run there have an whole theme called China to the world because in China, now their company is getting formed where the product could product market fit could be in as far away as Mexico and we are funding actually companies where Chinese entrepreneurs are building companies for the world. Xiaomi being the first big example and Apple, Pytans and others. I do feel that in India, not just in SaaS, but in consumer also, there could be a great story and of course you're trying to do that to a certain success level and so on, wherein consumer companies can be built, which will first of course dominate their own domestic markets as India, but over time also move into other geographies for us in our portfolio, for example, that bet started with Aeroditers where when we invested in them, they were a Southeast Asia, Middle East and South Asia story including India, India being a part of it. But today, they are significantly present in Southeast Asia for these three territories, but also they're moving into China, they're moving into Europe, they're already big in Africa, they're big in US and as well as Latin America and South America and hence the company has gone global where now the India contribution would be a very small percentage of the overall business and we are very excited to be part of those journeys and help the company think about globalization and how to build such assets and where to our teams, where to keep offices, legal structures. There's so much to answer that won't do it. So while we've done it with one company, we do hope that over time, a lot more of our companies can go global, not just international because the concept of international is, hey, I'm in India, let's go to Southeast Asia. Let's, you know, I think there's a time has come when Indian entrepreneurs can think really, really global and there are ways to do that and enough people have companies, whether it's Chinese or otherwise we've tried it and we would be very, very open to some of our really good companies who have the right to go global, can go global. Any, otherwise, otherwise, if you have not even won your own market and you want to go global, then something is wrong. Sure, I agree with you, but I mean, what, what kind of companies today have this opportunity to go global from India? I mean, you know, you mentioned oil and oil is a great example in hospitality, but hospitality itself is on a weak footing right now as a sector. So I mean, primarily if any sector were to go out of India today or any kind of startups were to go out, where would you see it happening? Look, I think I wouldn't name one or two sectors. I can say it can happen in most of the sectors because we are now in what I call as a third phase of startup revolution. The first step for startup evolution for us was can we see what is happening in India and sorry, in US and China and create copycat business models in India that happened from 2007 to 2015. The next stage of evolution came okay, while a lot of that is already done. Let's figure out what are the unique problems India is facing and build businesses solely focused on that without whether global products can be built a separate sector and in that journey, especially Flipkart, Amazon have to give enough credit to a lot of these stalwart businesses that got talent even from Silicon Valley to come and work into these companies in Bangalore. Now that the capability of figuring out how to build world-class products is there in the country. The same entrepreneurs are now saying, you know what? I'm going to start building a business in India, but let's open up a, you know, US office and put a tech team there and why don't we build a world-class product while we in first stage win India, but very soon we will go and build, you know, the businesses in other parts of the world and that is becoming a very constant theme that we keep hearing. Of course, we need a lot of live examples of success around it. We have one in our portfolio, but would love to see more, but this entire thesis and DNA can easily be replicated across sectors. Right. We have some questions coming in. I'm going to pass on the mic to Saurabh Kumar. Saurabh, do you, are you online? Can we pass on the mic to Saurabh, please? Yeah, hi. Am I audible? Yes. Yes, Saurabh. Yeah. So basically punkage, my question was that, you know, but the relation between India and China is probably at, you know, all time low with border issues and right when the pandemic started, so that time the government put in check that, you know, any investment from these neighboring countries cannot come through the automatic route. You know, it has to be through permission only. And, you know, we know that, you know, Chinese money has, you know, really boosted the Indian startup ecosystem with 25 out of 30 unicorns, possibly having money from Chinese VCs. But now we're seeing that there are some issues like, you know, the other day, which is an investor in Zomato that out of 150 million, only 100 million, you know, 100 million has not been able, Zomato has not been able to receive it because there are government issues. So how do you, how, what do you think of, you know, this space of Chinese money coming in into India? How will that pan out? And what does that mean for the Indian startups which are dependent on Chinese VC money? So my first philosophical answer was that is, please would be dependent on anybody's money, businesses and as even Sanjeev Bichandani keeps talking about and you talked about Zomato and InfoEdge, the best source of money is consumers money. So build a value proposition where consumer buys your product and gives you money and you make profits and you don't have to, you know, rely on VC money to kind of build your businesses. And I think that's the mindset that I talked about even in the middle of this conversation. The whole mindset of using cash to grow is not a very great mindset. In some businesses it makes sense where it's a winner take all businesses or network effects exist, etc. But beyond that, we have to build sustainable businesses and sustainable businesses are not built on the virtue of giving cash to consumers and asking them to buy products. So I do hope that there's a rethink with most entrepreneurs on how they are building their businesses and they end up being more less cash cussing and more sustainable even if the growth rates come down from the 300 percent to 30, 40 percent. That's fine. They will still build valuable companies at scale because the opportunity is extremely large. At the end of the day, Chinese money is not the only money coming into India. Money is coming from all over the world and globally money is extremely cheap. In fact, negative interest rates. So I don't see that there is a challenge for good sustainable businesses to raise capital. You don't have to rely on one source of capital Chinese or not. But do you think I mean today so many startups have been invested by Chinese money. Do you think with the face off that we are having with China currently it's going to have an impact? Look, I do think that there's going to be impact because of course that was easy money because somebody who's bought into your vision was willing to bankroll you for a slightly longer period of time. So yes, it is an issue. But if your company is good, you'll find other backers as well. And it should not be an existential crisis for you. Yes, it is definitely a speed breaker. Okay, so the next question is coming from Mr. Arunadeh Basu. Please unmute Arunadeh. Yeah, sure. Thank you so much. I would like to ask that do you guys also look at AgriTech and what do you think about AgriTech products in general like in the startup scene right now? So I think we do have an investment in AgriTech in a company called AgroStar, which is building a commerce engine on the input side of agriculture. This is a sector that I understand to a certain degree, not to very great details, but I do think that if in India we have to go through the next revolution in agriculture, then AgriTech can help provide that way. Now, whether it's around different ways of kind of farming in order to get better output, whether it's delivering high quality products to farmers. It's giving them a lot more information and knowledge to make sure that they can do a better job in agriculture, whether it's even going into IoT devices, etc., to figure out how farming can be done and precision farming, etc. All of those are opportunities that we can use to make sure that this entire sector, which is a very strong employment sector in the country as well as contribute significantly to our GDP can be boosted and it can be a game changer for the economy of India. So I'm quite excited about AgriTech, not just from a VC, but also as an investor as well as a professional. And I do hope that it lives to its potential for a country like India and also with your question, what is one sector which I think we can export to the world? AgriTech and AgriTech companies getting massive innovations coming out of India going to all emerging markets, including in Africa, etc. We'll see massive markets as we expand some of these businesses there and I'd get very excited about this thing. Sure. Thank you so much. I think that's certainly a sector to look at. We have another question. It reads like, you've been investing in the Indian ecosystem both as a limited partner and a general partner. Which one is easier to do? I think the easier one of course is, of course, as a limited partner finding GPs because at the end of the day, they're a handful of GPs in India. And when you then look at track records of who have delivered returns, you'll probably have those numbers as probably 10 or 20 GPs and you'll just park monies there. But the most difficult path is offer GP wherein the GP has to then go and find great assets in the Indian market, work with entrepreneurs, build those assets, fund those assets, and then finally exit and make money. That's of course the most difficult piece. But having said that, most of my time now is goes as a GP where we only do direct investments. We don't do fund investments anymore. That was a way for us to come into the market and understand the landscape. This is what we enjoy and we feel that while there's significant amount of risk attached to it, the massive returns attached to it is also there in the GP business model, not just the LP model. Sure. So, you know, I know we're almost coming at the end of our discussion, but you know, one final question to you, which I think we're getting asked a lot while I know you're a late stage investor. But I mean, if today somebody has to think about startups and you have to think about very, very early stage opportunities, what kind of startups would you be thinking about? I mean, for people who want to start or do a startup, you know, what could be great opportunities for them? Look, I think the way we so let me just understand because this is coming to an end. I don't want to give a wrong answer. Your question is how do we even think about the idea for which we build a business? Is that a question? Yeah, so actually we have two questions. One is that, you know, what are the good startup opportunities that are existing today or are there today, which, you know, one needs to look at. I mean, you said every tech is one opportunity for sure, which India could export outside as well as within India, but I mean, what are largely you think good opportunities or what sectors to look at to create opportunities? And secondly, you know, I think another question is which says that why is it so now going to be hard, which I think we discussed also to raise capital. And for some people, why does it become so hard to raise capital? They're not able to find capital anywhere. So honestly, I do feel that for the right opportunity raising capital should not be that difficult. Also, you need to be realistic of how much capital will be needed for your business and what their risk profiles are. So that's one one side. The other side also think about the VC that you're trying to operate, you know, go towards. Are they even willing to take the risk that you are that you have in your business? Not all businesses have the same risks. Let's say you today have an opportunity to put together an amazing some innovative product that you can design in your garage, which tomorrow Maruti can buy and put it in their cars and you can sell millions of them overnight. All you need is 50 lakh rupees of R&D work. By the way, most of the innovation that was old school innovation was product innovation. The whole concept of creating platforms and flip cards and a center center and the VC game. Let's let's try to see that there is a life outside of that also. So if you can make a product which is very useful, you may not need more than 50 lakh rupees honestly and you go and do it show it that product to Maruti. Maruti loves it. They orders order a massive amount of part. You go and do a contract manufacturer in China. Your entire capital base would be probably one flight to China, one flight to Bangalore and 50 lakh rupees of innovation. One crore, right? So please think about, you know, how you are using your time and effort and not chase, you know, endless amount of opportunities which you see others chasing and a lot of businesses are not VC back-well businesses, but at the end of the day will give you significant amount of value. I'm trying to kind of limit my entire business. It's a bad practice, but I want to always tell people that VC money is not the only way to build startups. Having said that, how else will you find opportunities? My biggest view is that please don't look at sectors on a top-down basis. Look at opportunities and problem statements at a bottom-up basis. Basically, what I mean is, if he has a significant problem and in India, we have so many problems that we need to solve for us to be a better country, figure out a problem statement that really, really troubles you and you think there's a solution that you have for that problem and you can monetize it. If you can just do that, you will have a business model in place. That's one. If you still can't come up with idea, please go to the VC websites of all the Silicon Valley funds. There are probably hundreds of them. They all have 10 investments. I've given you thousand ideas on within five minutes. Just look at what companies they're funded. That is what most of the entrepreneurs did in the very beginning, but that is not the best way to do it. The best way is probably what I just told you on figuring out a local problem that you really, really feel passionate about because if you don't feel passionate about something, you will not get excited about it for the next 10 to 15 years of your life. You'll not build it. Even if those examples are there in, you know, and VCs are funded them in other parts of the world and you know about them. So please do something that you extremely passionate about. It should be a really big problem. It should have an easy solution. It should address a large business or at least a large segment so that you can build a good business around it. And lastly, it should be monetizable. A lot of people forget about the last rule. It should be monetizable. You should be making money out of it. If you can do that, you know, you'll build a good business. And finally, a lot of those businesses will not be VC investable. It's fine. Don't take money from us. Take money from the consumers or the client. Yeah, I know they are always there. I tend to be slightly more controversial and, you know, different from most of the other investors where I'm coming and telling you don't come to me, but really, you know, a lot of businesses are not meant to be VC businesses. And that's the reality of the situation today. Yeah. No, I totally agree with you over there. Thank you very much for talking to us. I think some great ideas. And you know, while I know you're not a early stage investor, but I think the advice that you give to early stage startups is really worth its weight in gold. And I think the idea is really not to look for investors, but let investors look for you. And that probably sometimes work best for both the people. So thank you again for talking to us for a lot of other people who are listening to this talk. If you have more questions, please keep on adding those questions on our social pages. We'll try to get somebody from Pankaj or Pankaj Steen to answer them for you. And let's see if we can help you in some way to either raise capital or to help you find your ideas and give them life. Thank you once again, Pankaj. It was the most entertaining talk I've had with the VC and you're really, really true to yourself and you're very upright, which is the way everybody should be. Thank you once again. I enjoyed it a lot as well and wishing everybody a lot of luck on their businesses and please be safe. These are difficult times. So please take care of yourselves and your loved ones. Thank you. Thank you. Bye-bye.