 Hello everyone. Thank you for being here. I'm Saurav Kumar, editor special project entrepreneur India. Let me first introduce again our very special guest for this session before we start the discussion. We'll take questions from audience post the discussion. I request the audience to put their questions through the discuss tab. We'll take them post the discussion. Introducing to start the introduction. It is a pleasure to have with us today Mr. Champ Srinivasan, the MD and CEO of Federal Bank, a position he has held since 2010. He has immense experience of leading multinational banks in India, Middle East and Southeast Asia and he's an institution in retail banking, wealth management and SME banking. Under his leadership, the presence and visibility of Federal Bank reached nationwide and he has been instrumental in reinventing and re-implementing processes across verticals. Welcome Mr. Srinivasan. It is also my pleasure to have with us Mr. Sanjay Nath, co-founder and managing partner at Bloom Ventures, one of India's prominent early phase venture funds. In its eight-year history, Bloom made some stellar exits which include metal, metal runner, taxi for sure, promptek and zip dial. Its current portfolio includes grey-orange robotics and academia, rail yard 3 and skill apps, among many others. Mr. Nath's experience spans the US, India and ranges from management consulting to product marketing and operations and much more. Welcome Mr. Nath. I'll start with Mr. Srinivasan. It is really a difficult time for the entire economy. Everyone is under spread, the government, banks, businesses, the SMEs. In your career, you would have seen so many ups and downs. What would be your message for entrepreneurs right now? Especially the smaller businesses who are finding it really difficult to put on a brave show. Thanks Aurob and hello to everybody. Like Aurob mentioned, it is indeed extremely enormously challenging time for everybody and there is no textbook or template on how to deal with this. Many of us are figuring out the best possible given these circumstances to sort of weather this storm. But in particular to your question, how do businesses, in particular the smaller businesses manage to navigate through this? The way we've seen this is first, the most crucial one is to ensure somehow cash flows are there to keep the basics of the business going. Now there are a few opportunities that are there. Certainly if you're a borrower of a bank and you've maintained a reasonably decent credit history, then there is a government guarantee program that is there which gives you about credit clients without additional guarantee and additional security. So there is some kind of liquidity that is coming in. The second many of our clients have tried is to try and find other unencumbered security and place that and try and get some line. Third is people are trying to use the gold that is there in the possession to try and get some credit clients. Because this is kind of unprecedented. The banks are themselves facing challenges of trying to keep their ship going. So it's got to be collaborative. It's got to be an effort of getting the best possible lines of credit organized within these boundaries of some kind of security that you may already have or you have not used up a existing line. But the other part of the business is what we tell ourselves, tell our clients is how do you just stick to the basics and get cash flows going. Now in an era of many lockdowns, many uncertainties, people are struggling to get their flows going. And there are some sacrifices, some compromises that have to be made. And I'm sure you businesses trying to find the best ways of doing it. But to my mind, the local community businesses are suffering a little less than grand scale businesses. Because in every local catchment, there is some business going and small businesses that are able to cater to local demand and try to get the flowing. But there is no easy answer. Sir, we have to rely on the existing guaranteed teams, additional security on hand, try and bring in other security that you have not used up lines that you have not drawn up and above all bring out some of your gold available if you see the last four or five months gold loan companies and gold growth has been quite spectacular. I think we just lost Mr. Shankar. We'll wait for him to come back to Mr. Srinivasan. I'll come to you. We have seen during this period, we're getting mixed messages from the startup community basically. Some businesses are pivoting to remain alive and some are thriving. In terms of funding too, there are some spaces. Mr. Srinivasan is back. Oh yeah, please go ahead sir. My apologies for about 10 seconds. I dropped off. I don't have a point. Yeah, please go ahead. But I guess I was heard. Yeah, yeah, please. So you were talking about gold loans that they have done really well. I was only suggesting that while there are no clear cut, do this, do that, we have to figure out all the available options. And in a time like this where gold prices are on the ascent, people are... Seems some, must be some connection problem I think. Yeah, yeah, maybe some. So Mr. Srinivasan will just continue with what I was asking you is that, you know, so how have you seen what has been easier? You know, go ahead Sanjay, adding the line. Third time lucky. Let's try it. Let's try it. Yeah, maybe. Go ahead. I'll come back. Okay, okay. Buying some gold in the interim. Buy it from once. So Mr. Nath, as I was saying that, you know, we're getting these mixed, you know, messages from the industry from the startup ecosystem. Some are thriving, some are just trying to survive, just everything. In terms of funding also, some sectors, we've even seen during the lockdown that we saw they got money and they were, but there are some which are... So what has been your, you know, observation and what would you want to tell? We have a lot of entrepreneurs here in our audience. So, you know, they are looking, they are looking for ways to, you know, survive this period. So what would be your message to them? Sure, you know, we are hearing this word headwinds and tailwinds a lot, right? You know, I think as founders, there are market forces, but there is also your internal business. And, you know, my message to the entrepreneurs would be that, you know, think about what your end customers are doing, right? Because if your end customers are going through, let's say, positive or negative, then you are developing solutions to mirror that. You get a clue, right, of where you should focus. So I think the first is to, you know, to see this is this, the pandemic is going to be there for a while, right? In the sense, even if it goes away, there's going to be a lag. Like, for example, if there was a lag in the next quarter, you're only going to see the effects of revenue at the next quarter, right? We're seeing a lag effect. Essentially, we will have like lost a year, right? Because we're looking at six months plus six months lag. So the message to founders and entrepreneurs is one is that to make sure that you have enough money, one is to have enough cash to write out the storm, if you will, you know, extend your runway. If you needed six months in normal times today, you need 12 months of cash, you know, in our parlance, if you will. The second point is, you know, reduce your customer churn and really focus on keeping your existing customers. Because I think getting new customers is becoming a little difficult. So it's really important to deliver value to existing customers. And on the other hand, there are also silver linings, right? Because you heard this famous line that never let a crisis go to waste. And it's at times like these that great companies also get formed. Uber was formed after the 2008 financial crisis. JD.com was founded after the SARS crisis, you know, in the early 2000s. So the fact is that, you know, consumer and enterprise behavior is going to change. And you've got to look for those changes. In fact, I think if you have money, there's a great time to start a company because you can start with a green slate. So I would say, you know, again, I think extend cash, that's preserve cash. Cut all your non-essentials, focus only on essentials. And then look for those shifts, right? In, in tailwind sectors and in your enterprise and customer behavior that you can go and design solutions on. So we're actually quite bullish. It's a very tough time. There's a lot of pain, but it's almost like a reset, right? So the new world order is going to be very different. So there's a question and, you know, I'll take from there and borrow from there and ask you that, you know, he's talking about how do we, how do I grow my e-commerce business right now? I know that this is a perfect time for maybe e-commerce businesses to, you know, start. But what would your advice be if someone is trying for a e-commerce business? And apart from that, what are the sectors right now which really presents good opportunity? For, you know, if you said you can start with a clean set. So maybe someone had an idea but was not able to start it. So what are the two areas which if you have an idea, you can just start off right now. And it would be a good time to start. Sure. You know, by the way, we'll say, you know, I say that, you know, as investors, we don't predict trends. I think the good entrepreneurs are the ones that find something interesting and then come to us. But having made that macro statement, I think we're seeing some sectors which have really taken off. Right. If you look at tech, for example, you know, we have our own academy that you talked about. The fact is that we're all sitting in our living rooms, you know, on different conferences. Tools means that learning is changed and it's going to be virtual for a long time. Right. That's one. I think in e-commerce also, there's a big shift from offline to online. So at tech, healthcare as sectors, you know, are going to be very interesting. Of course, of course, FinTech. In terms of, in terms of, in terms of a question on e-commerce, see, delivery is going to be very interesting for us because with social distancing norms, I think retail is going to take some time to come back, right? Malls and things like that. They'll open, but they'll be with safety precautions. So the delivery side, right, focused on the versus the front side, which is around logistics around last mile around different aspects of delivery, right? You know, whether it's within cities, intercity, mapping, AI is really going to be a very interesting area, right? We have our own focus that does route optimization. And then they're saying that the online components, I mean, the large brands are shifting from online to offline. So if you're an e-commerce partner and you can become the digital partner, right? If you can go to SMEs and say, listen, I can take you online and become your online digital partner. There's so many opportunities there. On the other hand, you also have to look at an area where Amazon and Flipkart are not it, right? Because whatever, if you're competing with them, whatever you can do, they can do faster, better, cheaper. Having said that, I think sectors like EdTech, I want to see like a permanent shift, right? People are really questioning how learning is going to get done. I think online is always going to be their virtual learning. If you look at healthcare, look at telemedicine, consulting doctors online, even taking appointments for surgeries, healthcare is going to go through a whole transformation. And then we also, India is such a large market thanks to now, GEO and the large investors coming into Facebook and Google. But you also have built in what we call built in India for global markets, right? Built in back for global markets, which is really B2B automation is going to take off. So whether it is testing or other end, SaaS because the whole enterprise behavior is moved to the cloud. So you'll see a lot of SaaS startups coming out also. Vertical SaaS focused on verticals, but also horizontal. So quite a wide spectrum. And I would say we are quite in a fortunate position because we're already all 100% digital. And in that sense, I think we are at the recipient of some very interesting silver lining opportunities. Okay, great. Thank you. So Mr. Srinivasan, I'll come to you. So during this period or when this happened, so have you also noticed the change in terms of the businesses who are coming to you to look for money to boost their business or start their business? Have you also seen a shift in kind of business like business which are more tech focused maybe coming to you? Is there any trend which you can share with us? I think what some of the points which you mentioned are actually very interesting and most likely the new order. But normally businesses like this at the start of the day don't go to banks for funding. I'm talking about smaller businesses baby. Smaller businesses that come to us where the other way to say it is where banks are more encouraged to lend. Our businesses that are in this space that are more consumer facing and non-discretionary, which means things that they have to buy and consume. Food, technology, education, healthcare. Certainly there is a better connect on that. And we are seeing some pickup, but I would say that it's early because if you're a startup in that area, if you're not going to the bank, if you're an existing business which is branching out, then they're likely you're coming to your bank. So if an offline education space suddenly chooses to go online, then there's a good chance that he will go to his bank and have a conversation. If it's a small business getting to a local community but now needs a logistics support and has to put a mechanism of likelihood of going to the bank. But I believe you're not much from a point of view of people with a good idea coming to bank. And that's usually not the forte of the bank. Banks engage with clients to have an established business and then grow the direction. Therefore there is a challenge. But having said that, the willingness to do more in this space is certainly higher for banks right now. As long as the people who are backing it come with some kind of very credible background and have some kind of backing in certain banks will be. But I can't yet say the large number that I can see some sprinklings of it across here and there, particularly in banks for Mumbai and Chennai. Okay, thank you sir. Sir, we have a little time left before we have. So I would really want to know from you about the macro scenario that we are all facing. So what should be our next steps in terms of the entire economy, the government banks and everything? What should be the next steps that we should expect and ideally do to bring the demand back? Right now the demand has gone down and that is the biggest challenge of any economy. And that would be key when we go forward. So what in your opinion are the right steps that would be required to do so? We have to break this into three parts. One is like you pointed out stimulating demand. But if you feel back, the stimulation of demand is also a function of ability, confidence of people and the belief that the next six months, nine months, 12 months life will come back to some kind of rhythm in order. Because everybody is now benchmarking to how December, January or December 19 or January 20 was, when will we get back to that? And there's a certain degree of denting of confidence that has happened in healthcare and stuff like that. So if you have to bring back demand, one is that has to be inspired and that's not easy till we get some kind of good news on the vaccines and the medicines that are available to cure in the unfortunate event of the contracting virus. But the other part, which is the stimulation of demand, some efforts have been done by the government by giving credit lines and trying to make the liquidity in this country way higher than ever before. But I do think till people get the comfort that the next three paychecks or the next 16 paychecks are in place, it's not going to be easy for people to open up their purses. To that extent, that part of the demand will be limited. The whole middle India, lower than middle India is not going to sort of rush to buying stuff and consuming. So to stimulate that, some measures are required. In fact, later this evening there's a bankers meet with the prime minister where everybody is giving our two bits to tell him what he's going to be doing. But that's a wild card. You don't know which way to go, but the government also has certain limitations of how much they can spray money around. So to go back, one confidence and sort of a belief that the next six, nine months life will open up. That's a tall ask. Giving some kind of liquidity support and individual level. How does that come back? And I think there are some efforts, but I would argue that it's a little tough. Those who have taken loans, those who have some kind of borrowings have got a temporary release of a moratorium or an ability to spread their payment over time. Now, the real challenge would be, you know, come August or September when people have to make those payments. Will they be able to do that comfortably or will their cash flow enable them to pay? Now, if that were to happen, I would believe that we would be in a better place than today. There's a lot of ambiguity. People don't know whether the banks are nervous. They don't know whether they're going to get the payments coming in so they're stopping the lending. If that cycle gets more constructive and people are beginning to pay come September, October, I think there will be some pickup and it coincides with the festive season. So I'm a little more hopeful that by September, October, I think it will be a lot less gloomier. But you know, this is hard to tell. We keep telling ourselves just stay the course, head down to the Dravid Act. Yes, we all need to be Dravid's right now. Just keep playing, just surviving. So we are dying for a comment. Do we have a minute? Yeah, yeah, please go ahead. You know, Mr. Srinivasan talked about an interesting sort of distinction between startups and some of the consumer brands that come to them. I think what is interesting is in the last decade or five years, like let's say the last five years, you've seen an interesting meshing of these together. So today you'd have to ask, I mean, Geo Reliance has become a digital company today. Just think about it. It's probably one of the most valued digital or tech startups in the world, if you will. Consumer brands today, all of them, and thanks to the lockdown, they're being sold digitally even more. Everybody has digital strategy, all large corporations. So today you really question who is not who's a tech company, but who's not a tech company. And where that's playing out is that we are seeing that some of our startups go to banks for venture debt, for example, or you're seeing consumer brand focuses on VCs and Pee, private equity funds and digital VCs like us are investing together, co-investing, right? Which is great for the ecosystem because they're getting a complete perspective, you know, in both ways. I think tech companies need, it's very interesting. I'm looking at Mr. Srinivas said tech companies need sort of the guidance of a, you know, offline, seasoned banker like Mr. Srinivas and vice versa. You know, many of them also need, you know, fantastic tech coders to develop the technology digital strategies. So it's a very interesting coming together. The second part I'll just quickly add is that I think today we're finding that for our entrepreneurs, of course they want to create value and make money, but they really care about what they're doing much more than about 20 years ago, right? So if you look at, we've got Ulubike, Amit and his co-founders at Ulubike, or others who really care about the environment, right? I mean, the sense that, you know, you can do good and yet you can create value, you know, carbon capture. We've got carbon, carbon clean solutions. I think that's quite a change from 10, 20 years ago where they want to, I think sustainability and, you know, points, words like that have entered the vocabulary and that's interesting to note also. Yeah, I'm sure sustainability is something that we'll have to look for. Like, I was reading a report today that, you know, the pollution levels that had come down so much might, again, spike up if we don't act responsibly even now. So that's very important that we have to do. And of course to Mr. Srinivas's point that, you know, you have a meeting with the Prime Minister today to give your best I hope.