In Brief: Shunya One Ep. 11

Kris Nair - tech entrepreneur, investment professional and Partner of BOLD Ventures, a seed stage venture capital firm (investing in early stage companies looking to change how business is done in Asia) - joined Shiladitya and Amit to discuss what drives private investment to sectors such as core tech and core science. While initially discussing the mindset of investors and the popular investments in food tech, Shiladitya brings up the need for valuation of one’s business in (core-tech) and ageism in core tech investment.

From whatever experience I have running a business which was in core tech, talking to other people in the same industry - whether its vendors or whether its consumers - No one really spoke about the value of your company.....when you have to think of funding, you have to think about what’s the value of what your building.

Most people are just doing trading. Most companies don’t even have core value because they’re not a manufacturer as such - they’re just a layer on top of something else. The people who do actually create intellectual property, core IP (with cool science in it), most people don’t trust them, unless you’re an old dude who’s been with an MNC firm and held enough posts, only then can you be a science-y core tech founder.....How do you earn that trust [of investors] without that pedigree?

After discussing the need for diversity, India’s investment in space research, and the model currently adopted by the Kerala government, Kris explains the fundamental reason investors don’t put money into core tech/science startups.

We don’t have private investors betting on this because most of the private investors are used to paper returns happening in 2 years time [instead] of happening in 8 years time. If you can hold a share for about 8 years then its good, [but] then you’re asking the entire fund industry to change, right? The entire industry is designed to allocate money for about 4-5 years and then make the exits happen and then close everything in a box.

They continue to discuss what is a conducive ecosystem for such businesses

What is a ecosystem? Is it because the economic times is writing about it?...Or, having easy access to resources, team, capital, customers. If things go wrong as a founder in core tech I can talk to another founder in core tech......Capital is there but primarily from govt institutions (grants, etc)......direct customer base [is there], so the only thing missing probably is the biggest one.....basically, private investors betting on it.

Catch the full episode here: