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Sasha Mirchandani
Managing Partner -Kae Capital
Wednesday, February 1, 2012
Sasha is Managing Partner at Kae Capital, an early seed stage fund. His specialties include early stage investing, angel investing, business development and deal origination. Kae Capital Invests in early stage companies which bring about innovative solutions for the existing gaps in the markets, all backed up by a great team which is capable to execute and build large businesses. Kae Capital’s connections within several industries have been of significant value for the companies they have invested in. Kae’s investments include categories in the field of healthcare, ecommerce, Services, Education, Mobile, Technology and more.

Trends of investment in the Angel/Seed stage investing

*New dedicated funds coming up that specifically focus on the Seedstage investment.

*Angel networks being formed in the cities like Hyderabad, Chennai, and Pune.

*Time taken to scale a start-up has come down significantly. It would take around 5-7 years for a company to go from a Start up to an IPO. This was earlier more than 10 years.

*It is becoming easier to raise venture financing if the company has received funds earlier from well known angel funds/groups.

*Most angel funds will be investing in the range of $300,000-500,000.

*The deals have been coming from all corners of the country and not just Bangalore and Hyderabad which were earlier the only places for starting-up.

*Interest in this new asset class in attracting investors from across the globe.

*Incubation centers and Business Plan competitions across the institutes in the country provide good platform to source the deals.

Hottest technologies to bet on

*Mobile, E-commerce and Social-Commerce, Mobile Applications, Internet based distribution are some of the sectors where growth is expected. All these sectors are consumer technology focused. Growth rates are expected to be high in this mainly because of the easier availability of the enablers (3G services, Low Cost mobile handsets), greater broadband penetration, higher adoption rate of new technology and services among the youth.

*Use of technology in Education has opened up new avenues which earlier didn’t exist. The entire education sector can be divided into segments which have very different requirements in term of the technology and hence there needs to be several solutions to cater them and not a ‘one fits for all’ technology solution.

*Search and Recommendation Engines are seeing a lot of activity and getting attention by the investors in U.S and India both. This is a global business model and the ones who are able to come up with best in class technology and user friendly product wins the race.

*Social commerce is expected to play a major role in the online retail business.

New Opportunities for Innovation from a Start-up perspective

*Innovation is required in any business area and is one of the main factors for the success of the venture.

*Social Commerce will be the driving force for the online retailers and people who come up with innovative solutions to acquire the customers will lead the way.

*Mobile - Coming up with innovative apps.

*Gaming Industry is expected to see a high growth phase - Developing unique gaming content with a focus on social gaming.

*There is a need to have innovative solutions in the clean tech sector. With the government promoting the deployment of renewable energy, it will be a good opportunity for start ups to fill the various gaps in the value chain.

Advice to entrepreneurs

*Be Flexible, change your business model if required. Experiment with several alternatives.

*There will be several opportunities in almost all the sectors mentioned above.

*Approach strategic angel investors but not just for the sake of money. An investor can bring a lot more on board than just the funds.

*If the business model is promising along with a sound team, entrepreneurs will surely get funding.

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