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Rajiv Dadlani

Rajiv Dadlani

Director, Consort Capital
Mumbai

About Me

I have an early-stage investment portfolio of more than 40 companies, with several successful exits. I am an entrepreneur myself, and the Founder/CEO for Consort Capital, a 15 year old, premier Mumbai based full-service Investment Bank, which I set-up in 1997, along-with a Team of professionals, from the Investment Banking and Corporate Finance field. Have been a passionate investor, and very active, in the Indian early-stage / angel investment eco-system, for the past 6 years, since its inception. Am among the early members, of the Mumbai Angels, and also an active member of the IAN (Indian Angel Network). Further, have made several co-investments, with other early-stage super-angel funds like Blume Ventures, etc.

Investment Strategy

I like to keep it simple, and look for only a few key things, which are as follows,
  • Hunger and passion for success, in the entrepreneur.
  • Founders being able to see the big macro picture.
  • A good vibe and complementing skills between the founders.
  • Founder frugality.
  • A desperate need in the market, for the product or service offered, major pain-point solving.
  • Visibility of high scalability in the business.
  • High gross margins in the business.
  • Brand and/or IP creation.
  • Hard-work and tenacity.

Portfolio Companies

  • Apps Daily (erstwhile Onward Mobility)  -  Branded Offline Retail for Mobile Apps and Digital Distribution.
  • Apalya Technologies  -  Mobile TV and On-Demand Video Aggregator.
  • Birds Eye Systems  -  Real-Time Intelligent Traffic Monitoring Solutions.
  • Karmic Lifesciences  -  Clinical Research, Trials and Data Management.
  • Awacs AIOCD  -  Pharma Market Research.

My Criteria for Investing in Startups

On the investment criteria, I like to keep it simple, and look for only a few key things, which are as follows;
  • Hunger and passion for success, in the entrepreneur.
  • Founders being able to see the big macro picture.
  • A good vibe and complementing skills between the founders.
  • Founder frugality.
  • A desperate need in the market, for the product or service offered, major pain-point solving.
  • Visibility of high scalability in the business.
  • High gross margins in the business.
  • Brand and/or IP creation.
  • Hard-work and tenacity.

Attributes I Look for in an Entrepreneur

From my experience, mentoring and working with entrepreneurs, for the last several years, I think that the main thing in the founders, that I look for, and has been quite a rewarding formula, in the long-term is hunger and passion for success, founders being able to see the big macro picture, a good vibe and complementing skills between the founders, founder frugality, hard-work and tenacity.

Common Mistakes Startups Make
  • Under estimating fund requirements, and landing-up, being under-capitalized, as a result of, not closing an adequate funding round, from angel investors.
  • Not maintaining a proper and balanced budget, for spending the angel money raised.
  • Not having discipline and control, on the monthly burning of the cash.
  • Get blinded most of the times with their passion, chasing only what they believe-in, and not being nimble enough, to listen to the market, and make the much necessary pivots, at crucial times accordingly.
  • Founders not effectively communicating their vision to every single employee.
How to Avoid Making Such Mistakes
Avoiding these mistakes, can only come by experience, and therefore serial entrepreneurs, are the only ones, who already have most of these hard learnings with them, from their past experiences.
Professional angel and early-stage investors, are the only other experienced lot, who can ensure that the founders of their investee companies, do not commit these grave, but common mistakes.
Most Popular Types of Businesses in India at the Moment
Based on my assessment, the following are the most popular types of businesses, in the early-stage eco-system in India currently;
E-commerce, Social Media, E-commerce Enablers, Consumer Internet, Mobile Products, Mobile Payments, Mobile Solutions, Digital Media, SaaS, PaaS, IaaS, Healthcare, Education, Internet Technologies, Internet/Mobile Platforms, Renewable Energy, Cleantech, Waste Management.
Fields in which Indian Entrepreneurs Should Be Building Startups
I would encourage entrepreneurs, to pursue whatever field they are passionate and have relative expertise in, which offers high growth opportunity, is not very capital intensive, highly scalable, where operating leverages can be built, which offer brand and IP creation possibilities, having relatively high entry barriers, and could possibly sustain, high gross margins in the future.
Thoughts on Being a First Angel
Have no real fixation on being, or not being the first angel, as do not think, that in the long-run, it makes any difference, in my experience, apart from a difference in entry-valuation, which is balanced/compensated, against the extra risk, that the earlier angel investor is taking.
Thoughts on Follow-on Investments
Yes, it is a prudent strategy, to reserve some money, for follow-on investments. Most of the start-ups, even the most successful ones, that I have invested in, have always needed, a bridge/follow-on round, before getting to break-even, and their Series “A” institutional funding round.
How Much to Offer an Angel Investor
In my experience, most of the entrepreneurs, who never manage to get their start-up funded, and therefore off the ground, are where the founders, do not properly understand valuation metrics, at different stages of the business, especially the early-stage, and therefore are not very flexible, in their negotiations with the angel investors, in terms of valuations.
Typically, most of the transactions, at the early-stage in India, with angel investors, are taking place between $ 1 - 2 Million, as the pre-money valuation, therefore the angel investors, land-up with equity stakes of around 15 – 30 %, depending on the quantum of funding, for each individual start-up.
One or two board seats, for the angel investors, is more or less become mandatory, nowadays, in my experience, as otherwise, the angel investors do not have comfort, on how the company would be run, as active mentorship, is one of the main keys to success, at the early-stage.

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