 We start with you. Hi, Vikram Gupta, I'm the founder and managing partner of IVCAP Ventures. We are a pure domestic venture capital fund. We manage about 4,500 crores of assets, portfolio of about 40 companies. We are a series A investor. So I'm probably the only one on the stage who's actually not investing in venture debt. So it's an interesting perspective probably I'll bring from the other side. But yeah, so I think, but we did contemplate at one point to set up a venture debt fund of ourselves, which we decided to not do. But we continue to focus our energies on series A, seed to series B, but series A is the primary focus. We are sector agnostic. We are currently investing from our fund 3, which is a 2,000 crore sized fund. Hi, thank you for having me on the panel with fellow colleagues. This is Ishpreet Singh Gandhi. I'm the founder of Stride Ventures and Stride 1. Stride Ventures is a fund business so far where we run four funds now, 3,300 crores asset under management, domestic and international. And Stride 1, which is also ecosystem financing around startups. So venture debt is something which we'll speak about. But our core thesis is around startup credit. And that's what we focus upon. Thank you. Thank you. I'm Vinod Murli. I'm the co-founder and managing partner at Altaria Capital. First up, it's great to see the stage is so big now. It used to be two or three of us a few years ago. At Altaria, we have three funds providing venture debt. We have about 4,200 crore under management and about 150 companies that we've backed over the last five, six years. So looking forward to this conversation. Hi, hi, everyone. This is Ankur here from Black Soil. Thank you for having me over on this panel. I'm the co-founder of a platform called Black Soil. We basically finance startups from pre-series all the way to their IPO stage. I've worked with over 150 companies, deployed over $300 billion so far. Hi, everyone. This is Sanket Sinha, executive director and head of asset management at Lighthouse Canton. Our firm Lighthouse Canton, we are an asset and wealth management firm with presence across the region, Southeast Asia. That's Singapore, Dubai, and India. We manage circa $3.5 billion of assets, and private markets is an area of focus. As far as the venture ecosystem is concerned, we provide capital solutions across the capital structure. So we have an early stage venture equity fund, and we've recently launched a venture debt fund, which again is a regional strategy, India as well as Southeast Asia and the Middle East. Thank you. Hi, Ashish. I'm with Inovan Capital, and we are positioned as a regional venture debt platform, so largely India, China, Southeast Asia. So I think in India, we've backed over 300 companies, and I think over $1 billion of venture debt has flown through the platform in different geographies. Thanks. Hi, I'm Rahul Khanna, co-founder of Trifecta Capital, with a platform that focuses on the growth financing needs of startups in India. We have a venture debt fund and a growth equity fund. We also have a services company that provides things like treasury management to hundreds of startups now. Thank you, everyone. So Ishpreet, my first question is to you. According to a report by Stride Ventures, so the Indian startups saw a considerable increase around 2.6 times more when it came to raising debt funding. So what do you think, what's the reason behind this, and why are founders choosing this way? Yes. So if you just see the venture debt history in India, I think the couple of things which came in play first naturally has the ecosystem maturity, which all of us will speak about. But I like to believe, I think 2015, 2016 was a tipping point when you saw people, venture capital funds, being fairly more active, and the deployment of venture capital started draining grounds. Over a period of time, the way venture debt has been construed, especially in a more of a bullish market when there's a lot of venture capital flow, is to come on top of equity rounds. So 2021 was naturally one of the best years for the venture capital ecosystem when you saw a lot of equity flow, which in tandem resulted into the debt flow as well. But what also happened, parallely, as per us, is maturity of the founders to understand how the debt ecosystem should work. Because when you take venture debt, there is a certain element of degree of comfort as investors, which we get in the equity investors infusion, but founders' awareness about the asset class further increased. And at least that's right. We saw that opportunity to make sure that we create more awareness about the products. We launched in more products which was more centered around the business of these firms to make them further aware about the working capital cycle, K-PIX financing, revolving facilities, international financing. And I think that the grounds started moving in a direction in which all of a sudden, they started emulating what possibly banks can offer them and can venture debt firms create those kind of structures. So the awareness level, to answer your question in a summarized manner, I think there are two forms. 21 was a further accelerated year for a lot of venture debt deployment. But post that, since the equity flow has got reduced in the past 12 to 18 months specifically, the awareness is leading into more fueling of taking venture debt as an asset class. And the use cases have emerged. Awareness is all time high by the founders. And I think all of us, while representing the various organizations of ours, ensured that we were trying to promote the asset class in general. So I think that has gone down well with the founders in the venture capital ecosystem. And we see the deployment or the demand being at all time high in terms of various structures. So that's specifically to the 2.6x quoted number. But I firmly believe we are just getting started. There's a lot of deployment which will happen. I think we'll be behind this cycle. And you might see a better outcome on the debt numbers as well over a period of time. Thank you. Vikram, if you can tell us about the other side of the story, what do you think about it? So I think, as Esprit explained it very well, but this is, and of course, all the people you see here, of course, they're veterans in this area. We actually have seen it from the other side. Being equity investors, of course, one of the key aspects for us is once you invest it in a company, then you want as little dilutive capital as possible. You want as much as non-dilutive capital coming with a lot of value addition. So venture debt to us is actually not just the non-dilutive capital, but it's also the quality of people who come with a little bit of equity mindset as well, because they understand the business, they understand the dynamics and the other aspects of the business. So I think as an asset class, we've seen it evolve, and it's actually happening in the other markets as well in the developed countries, where the venture equity market starts building up, and the venture debt market naturally progresses after that. And I think India, in my view, is very clearly ready for absorbing a lot more venture debt. I think, as we know, they were talking about that maybe a few years ago, there were just two or three people here, and then suddenly you see seven people sitting here, and then you have another maybe quite a few who are actually quite actively now investing in this market. From our perspective, as equity investors, we sit on the boards of these companies, we are seeing now maybe in certain cases 10 to 12 term sheets coming from all these different venture debt funds, and I think, therefore, it becomes very important to see what differentiates one from the other. So, and we are seeing many of these venture debt funds actually building their own differentiation strategy. So I think each one of them here, and we, I think, know all of them very well, we've seen that there is a clear differentiation that we can see amongst all of them sitting here, so a very different kind of value that they bring to the table. So that's good for the ecosystem. As Prith said, entrepreneurs have matured a lot, and they understand this space now very well, so therefore they are also now aware who they should choose as their partners on both the equity side, also on the debt side, and I think it's only building up. I think outside it's just the beginning. Thank you. Would any one of you would like to add to the question, like the answers to the question? Just a comment on the fact that there are 12 term sheets. That's not good news. I think just adding a quick couple of bits to that, there is a market maturity which is visible. Going back, I think Vikram and I did our first deal maybe nine years ago, and there was a paucity of capital in general, not about debt or equity. So India's come a long way. I think today, despite all the gloom and doom in funding, if you look at the sources of capital, we are looking at lifetime highs for pretty much every investor active in India. So India focused strategies today have the deepest pockets. The economy fundamentally is looking pretty healthy, and we are possibly one of the brightest parts in the global comparison. Having said that, there's of course a lot of pain in the startup funding context, and deals take more time. Sometimes 12, Wednesday term sheets come through and makes life difficult for equity responses as well. But I'm very happy with the quality of the founders that we're seeing today. There is a lot more mature. I think between all of us, there are maybe 500 unique companies that have been funded. So there are 500 founders who've tasted debt, and there are so many more stories that go out into the ecosystem, which makes a difference. So there's a lot of understanding of what has worked, what has not worked, who has worked, who has not worked, and it's all context, right? It's never the same for everybody. So I think we've come a long way, but yeah, it's still day zero to one, I would say. Thank you. If I can just add one thing, I think as people are becoming capital efficient in this new era, people are valuing debt very early on. Earlier used to be more of a venture debt, was just a more sort of thing which was used, utilized, part of grounds. But now people early stage itself from pre-series, they want to sort of find a way to have a small component of debt so that they can see how it works, and then use it for strategic purposes. Some of the use cases already Esprit has mentioned, and based on that, build a more sustainable business which has become now the norm for the new era of cohorts of companies which is coming in. So to add to what the fellow panelists spoke about, we spent a considerable amount of time and we decided to launch the venture debt strategy, studying the Indian venture ecosystem as well as the Southeast Asian venture ecosystem. And I'm just gonna put out some of the numbers that we arrived at based on the study. So we believe that over the next five years, India's venture ecosystem would be absorbing close to between 200 to 250 billion dollars of capital, which is give or take 50 billion dollars every year on a run rate basis. India would have nearly 250 plus unicorns over the next five years. And the combined valuation of the startup ecosystem, we expect it to be between one and a half to two trillion dollars. Now when you look at the size of the venture debt market right now in the context of the numbers that I just spoke about, I mean it's sub one billion dollars a year. And if you just extrapolate it over the next five years, assuming a 20-25% growth rate, we are still talking about seven to eight billion dollars. That's nothing. So I believe that there's a lot of headroom. There are new people who are gonna come. We are all gonna coexist together. And as Ishpreet rightly said right at the beginning, this is just the start. So my next question is to Ankur. What factors do you consider when you identify and filter potential investments? So on a process perspective, sometimes it takes almost two to three months for us to really decide to do a transaction. And after having spent seven years, we have started spending a lot of time on the data that we have created over a period of time on deals that we have worked with, we have not worked with including the companies that are part of our portfolio. And use that data to sort of try to figure out which kind of business models are really making sense. Because when we are entering a company at point of time, we do not have the view for the next two to three years. And we try to use the data that they have created because many times founders say many things about the data, about the business, how it is performing. But there is a big difference between what actually is the business MIS coming to. And sometimes there's a difference between the banking that sort of really comes into the picture. So we're trying to sort of put all of this together and see whether this company really has the potential to what they sort of stated mark is. Because already institutional investors are there, so there is obviously already a good amount of work. Hygiene work has been done on the company in terms of, you know, the kind of company that is there, the business model, et cetera. But finally, is this business model working on a say where there is a unique economics in place? Can they be a category leader? Can they go to a stage where raising next round of funding is how important? Or is it going to be a company which can start creating cash flows as well? Some of these parameters will look into the picture. And on top of it, how are their capital efficient from a working capital perspective? And is it going to be a business which will keep requiring a lot of debt? Or is it going to be a company which can work with a very small amount of debt and really improve its turnover ratios? So some of these things sort of come into the picture. And we like to benchmark those companies against multiple other portfolio companies we have seen and see how they are stack up against each other, right? So one of the easiest places we are able to do it is, for example, in the fintech space. In fintech, you are in personal lending, you have looked at. You can really compare businesses and see how they are really performing across multiple parameters. And being unlisted companies, it's very important that you are not just looking at whether the founders have the right, all of those things in place, whether they are great capital, but the business also stacks up on its own. Thank you. Ashish, my next question is to you. What is an urban capital strategy when it comes to potential investments? I mean, ultimately, some of it Uncle touched on. See, this is a different kind of risk return asset class. See, the color of money is the same, whether you take from equity or debt, right? You can use it for the same things, whether it's to hire people who grow or whatever. The risk return, ultimately, we are raising, we are managing third-party capital. So the risk return here is we do not want to take as much risk as a early-stage equity investor vote. And, you know, our return expectations are also a little lower. So I think we pay a lot of attention to, like, you know, you may have heard of this concept of type one risk and type two risk. So type one risk is false positive. You know, something you thought was good and turned out to be bad. And type two risk is something you thought wasn't that good and turned out to be great, right? So if you are an early-stage investor, I mean, you are happy to take a lot of type one risk, but you don't want to miss on that type two. I mean, you know, early-stage investing is a whale-hunting business. It's not a tuna-hunting business, right? For us, I mean, we obviously want to maximize the upside, but we want to protect the downside because in our risk return model there is only so much credit risk we can take. So when we look at companies, you know, apart from looking at the internet economics, market, all of the good stuff, and obviously getting some insights from existing investors who have kicked the tires, who know a lot more about these companies, right? I mean, you have to really first always think about the credit risk. I mean, you know, valuations come second. Would you get your money back? Because our investors, I mean, I can tell you like in our portfolio, just on the portfolio. I mean, we have, you know, for whatever it's worth, 36 unicorns, right? Now, we have seen journeys of people, you know, kind of going 120 miles an hour and, you know, kind of hitting a speed bump. So in this business, I mean, first and foremost, you want to make sure that there is a clear use case of debt. The founder and existing investors are thinking about, I mean, it has to serve a purpose and whether it is, you know, to optimize dilution or whether it is basically working capital, et cetera. But, you know, eventually that debt needs to be repaid. So is there a, you know, kind of thoughtfulness around that this debt would need to get serviced? Or is it just a basic thing of, okay, let's add some liquidity and go all out and see what happens, right? So, I mean, eventually the risk return is different. So we pay a little bit more attention to, you know, the downside and generally venture debt people are a little more pessimistic. So, you know, if you're an early stage equity investor, it's about, you know, what can go right. And a lot of times we also have to look at what can go wrong. So, I mean, otherwise it's the same company, same founders, same industries. Thank you. Rahul, coming to you, I would like to know what's the first rule of venture debt like for you? Don't lose money. So I think, you know, the cardinal principle is try not to give money to venture capital fund because our investors are large, typically tend to be large institutions, banks, insurance companies, endowments and fundamentally they have a choice. They can give money to a venture capital fund or they can give money to a venture debt fund. I think to Ashish's point these are two different asset classes. When they give money to a venture capital fund it's to maximize the upside. Typically when they give money to a venture debt fund it's to manage the downside risk, deliver consistent returns and predictable outcomes. Unlike venture capital where you have large outcomes and one company can forgive a lot of mistakes in venture debt you generally have smaller equity positions in these companies and if you end up losing a lot of capital it's very hard to claw back that through equity gains which typically are through small positions in companies. So, rule number one is, you know, don't lose money and rule number two is rule number one. Vikram, could you add to it? I think Rahul put it very well and we also have mostly Indian institutions as our LPs. We have banks, insurance companies and these are all equity, they're investing in venture equity, right? So, from their perspective it is looking for not just the upside in terms of returns, they're also looking for avenues to build relationships and start-ups. Notice that lots of banks, insurance companies are now actually investing in this asset class and also doing the same thing now I guess with the venture debt guys as well is basically trying to build that relationship angle with the start-ups. But I think the, again if I look at it from the perspective of the equity and I think given that now we are seeing very good quality venture debt funds in the market and of course what we're seeing is that historically you know people have been thinking of series B onwards kind of venture debt with a lower risk now we are seeing that even at series A or sometimes even pre-series A actually venture debt is coming at those early stages which is actually which seems to be very risky but at the same time as you know Ashish and also I mentioned earlier it's a lot about you know your comfort with the cash flows and the business plan and how actually the certainty of you know the future of the business so I think of course and I presume that the 500 companies that Vinod mentioned where the venture debt is all deployed I would assume that probably almost the entire of that would have some venture capital investors already there which means that you know there is not just a bet on only the entrepreneur but there is a bet also on the investors who are investing in those entrepreneurs so effectively if the company is going down will the investors have the ability to make sure that the company not only survives but comes back I think that's another bet that I would like to make I just want to add to the point about how important it is to have the right equity sponsor I think we place a lot of emphasis on who's on the other side of the table as the founder and then what's the quality of the equity sponsor we've done about 5000 crores of venture debt in the last 8 years and over time we found certain patterns in picking the right sponsor for that particular investment I will say though I think clearly these are two different asset classes and I think the way we think about drawing the line between venture debt and venture equity early stage is about taking concept risk and if venture debt funds are taking concept risk then I think they're drifting into dangerous territory I think venture debt funds should largely take execution risk and therefore I think if you find that debt is coming into very early stage companies then I think that's a challenge there and I would counsel even young companies to be mindful of the fact that debt is an obligation to repay it sounds very tempting when you're raising a seed or cities around to take on some debt with it but rest assured it is an obligation to repay and I would therefore counsel everyone to be very mindful of when you take debt in your business it sounds counterintuitive as somebody who's promoting the venture debt asset class for a long time it is a double edged sword so you have to be very thoughtful about how much debt you take can you service it and if you don't have the confidence to be able to pay it back then please don't take it I just wanted to give a couple of different perspectives one is the market we are in as Vikram said there are investors in every one of those final companies and India has traditionally been a very weak contract and forcibility market it doesn't matter sometimes what rights you have you have to still have the ability to enforce that and that doesn't always have to be judicial or legal it often comes down to the kind of adult supervision that is there the board oversight that is there the investors who have a fair bit of influence in the situation versus say a US or Singapore or China for that matter if you take the US market evolution for venture it's very very temperatized so you know that in these kind of situations if you lose some money in these situations you won't lose money India is a haze we have to work through different people in different situations so the ability to price risk is also kind of an earned game in India it's not so easy or natural and a lot of it is not about what's on paper it's about the relationships so going back to the earlier question you asked about what differentiates any of us here and then whatever contractual terms you have because without the first two you are likely to lose a lot more over a long period of time and for the founder the expertise is important and for the investors and the founders that would say the relationships become more important because it's not just one deal it's not just one transaction or one day it is days, weeks, months, years we're all in the same ecosystem we're doing the same work again and again and again so when you have 25 situations across say two firms then people tend to actually get more predictable and consistent and that is how you can price risk more meaningfully over a long period of time I feel Thank you so in 2022 it was the fintech industry that was a dominant industry which had the maximum decent venture debt so I'd like to know from Sanketh first what is his opinion about it and what do you think like why is that so is there a transition or a shift in 2023 or other sectors also being more dominant there would be two reasons why fintech and within fintech I would say primarily lending tech would be a big consumer of credit because of the fact that A it's an industry which is capital intensive if you have to go out there and lend you need to find ways of raising capital which is the first port of call but as companies start growing they start looking at other forms of capital as well it could be venture debt it could be straight debt from debt capital markets from NBFCs banks so on and so forth so that's the reason why fintech would continue because if you look at the startup landscape and amongst various sectors fintech would be one sector which would be consuming the maximum amount of capital so that trend I expect to continue going forward as well purely from a lenders perspective most of the companies or a large number of companies that we lend to I mean we go in a senior secured but most of these companies are asset life right but when it comes to companies which are in the lending tech space I mean you get a security you get a charge over the loan portfolio and your expected loss given default when you're lending to a or when you're like you know lending to a company which is in the lending tech space would be lower compared to a lot of other sectors so these are the two reasons why I believe that lending tech companies have been leading or have been there right at the top of the leaderboard when it comes to borrowing from venture debt funds and I expect that trend to continue as we move forward no like please that I think you were saying something I was just saying hello see financial services globally is the largest profit pool in almost every country you can go outside or maybe North Korea so I mean it's like saying you know Delhi has the most cards so frankly that's the largest profit pool which means that's where the largest amount of equity capital would come in and since we are a derivative asset class as more equity comes in on the capital structure there is more question you know because equity is the junior capital that sits on top of that so I mean basically it's a very large space so there's no big trend every country you will go financial services you know when you especially start looking at right from payments to lending to you know distribution of third party financial services products insurance asset management it's just the largest sector so I mean not too much other reason for why venture debt is there because that's where the maximum amount of profit pools are there let me add a perspective here the reason why financial services or equivalent businesses will always have large quantum of debt because it's a raw material if it's an NBFC business you're running a consumer lending or any form of lending of business you want to leverage your equity if raise equity capital you want to leave it on top of that so you would require debt either you get bank debt or you take venture debt it would be naturally more expensive but cheaper than equity so it's a form of capital so since we all largely do certain sectors allocation as well post financial services it will be B2B businesses again the use cases will be working capital all of these businesses which are B2B heavy you'll find them that the sales happening in terms of unlocking of lot of working capital hence venture debt third sector which you'll find us deploying will be consumer again if you're a consumer company you procure goods you have an inventory holding period and then you have offline sales this has to be financed so third sector will be consumer so everything which has a financial angle to it any kind or any form of business you'll see venture debt being prevalent more than the other forms of capital so you'll see us absolutely comparatively low on SaaS typically do not require too much of working capital so forms and shapes are largely settled another point which I wanted to make there was some talk on reliance on venture capital this is very important integral to get the sanity and hygiene check done I think this is a time for all of us to just start playing more vital roles in company I think there is there is a time to actually have partner first approach and understand these businesses understand cash flow and create structures because I think the best time because of the equity lack of equity capital you're sitting on a best time in terms of getting a mind space of the founders in today's time because they're looking up to debt as an options if you're able to underwrite business as well I think there's a best time to create venture debt legacy in India and at least we believe that it should be cash flow driven and as you go deeper in cash flow you'll unlock various answers and unlock businesses which will propel and especially considering the audience which are sitting here I see a lot of young crowds that's why we have to we have to start going early we have to start understanding these businesses as early as institutional capital comes in and attach ourselves with various use cases a macro answer to that question as well all these I agree completely I think for the fintech industry especially the NBFC market ILFS was a big issue for five years ago when that happened it sucked out a lot of liquidity from the ecosystem two years after that we had COVID and for 15 months a lot of the retail lending books in India took a lot of pain so they had huge provisions and they had to actually convert that to write-offs so you actually had about four years where the conventional taps were not flowing as freely into the ecosystem what's happened after that is a lot of the pain has been taken and structurally these kind of lending companies need the next full year of performance or profit to actually get rated and come back and get access to conventional capital which is happening now so for the last 15 months you had a phase where they were literally there was an arbitrage of performance where the ratings were not showing what the actual on-run performance was and a lot of these companies are growing very fast so they need access to more and more capital but their data was not supporting that access to conventional capital which created a little bit of an outsized opportunity in my view now the performance is visible, the ratings have caught up and they have access to cheaper capital as well so sometimes the journey for us as providers of venture debt is also to identify some of these inflection points in different sectors and it's not like the same size fits all across all time thank you so my last question for all the panelists I'll start with Rahul so on a scale of one to ten how would you rate the current venture debt market in India? look it's the best of times and the worst of times the truth is that the loans are ringing off the hook because lots of companies are looking to find a way to stay alive and continue to grow on the other hand I think the bar on doing new deals has to be very high in this environment so I think there is a lot of demand for venture debt I think we have to be very disciplined in this environment because for many of our companies are loss making and they truly do need at least one more round of equity financing to get to being fully sustainable so I think being a cowboy in this environment is not necessarily a prescription for good health so I think for us we are being very disciplined we are open for business but the bar is high okay so you will not rate what would you rate? I don't know you can call it zero or ten I guess it's a great time but for us we are a decadal business so I don't think I want to necessarily score six months or a year I think one has to take a decadal view I'd say the next ten years ten on ten alright I would put it like six and the reason is if you really see the asset class which is very niche I mean still niche we are a subset of private credit which is trillions of dollars so we are still very niche but at least venture debt now globally has started you know kind of getting some mind space same in India so that is the positive now the one thing I need to kind of build on what Rahul said see this is typically there not too much seasoning that has happened so while there is some seasoning that has happened but you know if you look at probably 80-85% of all capital that has been deployed in venture debt has come in the last two to three years because the market was very small so given the kind of an asset class the jury will be out I would say another three-four years from now so given the unique nature the risk return I think all of us here and you know other kind of peers of ours I mean can they deliver the kind of returns that we promise you know for the risk that the investor is taking I think the jury will be out in the next three to four years because I mean demand is there but you know we are still a 20-20 over game we are in the fourth over and you know third ball is still to be bold So I mean depends on how you view the question if you talk about the growth prospect of venture debt market in India I would rate it 9-10 but if you talk about where it stands today it's a 3-10 but just adding to what Rahul and Ashish said you know we are early innovators in this space I mean some of these guys can really call themselves early innovators we are a bit of a lighthouse a bit of a late starter but we are still scratching the surface there's a lot that's riding on our shoulders it's a niche asset class still early days something goes wrong it can be a breakdown for the product as well I mean it happened in supply chain financing globally a name that I would not like to take but it's happened we see where we are and where we can be we can't be cowboys we have to be very prudent judicious when it comes to lending and I hope that collectively as a group that's what we are going to do and take the market to where it really deserves to be I agree with all my fellow panelists so far I think I would broadly rate it around 6-10 in line with Ashish I think since we started back in 2016 the real evolution of the industry happened so far and there's been a good amount of sophistication in terms of the products that has come in a lot of competition also has come in which also ensures that the companies are getting best of terms as the providers you are also trying to provide the best of quality of services and your underwriting also is also at the edge I think the cycles the way we are living in the cycles are getting really fast nobody could have predicted 2021 what will happen after that and it quickly changed what we are going through today also will not last forever but the jury comes out in debt very quickly because these are all amortizing products so the capital needs to be recycled much faster so we will not maybe have to wait for 3-4 years to see how the underwriting was for multiple funds we will start seeing the quality much sooner than that and unlike VC firms which are looking for a long term longer horizon of their funds hours much shorter and the kind of names that we are seeing in terms of which is coming in the media on corporate governance issues you start realizing that your corporate governance standards your underwriting standards the way you look at your companies it's an evolving process it's not that you what we do what we did back in 2017 not what we do today and every day we are learning from the market and improving our process so this is the case for everybody all the players in the market almost as the numbers that we see is very exciting but still there is a lot of work to be done till we reach some of those numbers because we have to ensure that we are picking the right kind of companies that we are backing and the use cases are right and at the same point of time the risk element is really spent time on because we are not a return game we are more on the risk side as Ashish also mentioned earlier so keeping all these parameters together there is a lot that can be done a lot we are already doing and I think we are barely scratched the surface I think I am a little bit more optimistic than all these guys here so I have been doing this for the longest about 15 years now and I would say it is about 8 different reasons for that 10 years ago what we did in a year we do it a month at this point in terms of velocity of transactions the first phase I would say in 2014 was a lot of just awareness, evangelization getting everybody to understand what this product actually is and isn't today I think it is collective effort here there has been a lot of unlocking of domestic capital that has happened there has also been foreign capital that has shown interest to come into the space 500 plus founders who benefited from this product and if the long term view is that India is a very strong and I feel venture debt as a proportion of venture equity is going to actually increase sharper than people expect and the correlation with the US market I think we are already moving past that so I think 2013 was when I felt the weakest I thought the market didn't have too much depth at that point but this vintage I think would turn out to be possibly one of the best in any form equity or debt I think the founders are coming to get access to capital build strong teams I think are poised for massive success because the tests are harder so definitely more optimistic so I would say 8 so I actually benchmarked this since 2018 when we started when I started that point of time we had certain numbers of venture debt which was getting deployed and there was a perspective of founder I think we can safely say it was around 3-4 out of 10 what we stand or say today I think what Vikram's point 12 term sheets fighting to get into a company with competitive pricing innovative products every company is aware about what venture debt is as a term and how it works to an extent of what structures you are talking about have started they started speaking about it so definitely you are maybe with the notes 7-8 out of 10 on both the parameters but the most important point is the macro point we are getting started second largest globally we are just getting started how you see 3 or 5 years hence is easily 3-5 billion dollar opportunity and percentage of venture debt to this point as well will definitely increase because there will be more players there will be more structures there will be more innovation around how it should be done I think there should be more awareness towards how we can handle founders that will improvise as companies grow larger and depth of understanding increases I think we are getting up sanguine times ahead but definitely very positive about this I will give a slightly different perspective I will look at these ratings from the supply side and the demand side the supply side is the amount of capital which is available if you go to the LPs to raise venture debt I think the penetration if you rate these based on the penetration my personal view is that I think we are only 2 out of 10 5 times more capital than you are actually raising today which is available which if you go and just talk to the people I think there is capital sitting there if you actually go and tell them this is an asset class you know this kind of characteristics of this asset class would you like to invest in it I believe that you can find 5 more times 5 times more capital than is actually there in this asset class today on the demand side which is actually how much actually is getting consumed by these startups which is actually how much actually given take DPI to register startups our estimates say that about 25 to 30,000 of them are seed or angel funded about 4 and a half thousand are seed sorry series A funded we now talked about 500 which are venture debt funded I think you can actually double that number at least so we are talking about a penetration of 5 out of 10 they are on the demand side so I think I look at from that demand side supply side