E318 | EUVC | Sumer Juneja, Managing Partner at SoftBank Investment Advisors on fundraising dynamics in venture between Europe and India

28:36And if you don't consider every deal as an internship, you know, complacency will set in. And then you have to flip it the other way. You can't just say, oh, I learned from my failures. That's the common thread you hear. But actually, you learn a lot from your success as well. So when companies go well, you got to step back and say, okay, and be honest to yourself. How much was it timing? How much was it macro tailwind? And how much was it, you know, regulatory changes which worked towards, you know, which helped your investment? or how much was it actually the micro analysis you did and found the right entrepreneur?

29:07So I think you put those two together is super important. Do you personally or inside SoftBank have a defined process to kind of do those postmortems in the bad cases? No, no, you have to. I think we all do it. I think what we do a lot more of is postmortem of deals which have gone wrong. I think what we have to do more of is postmortem of deals which we missed. Because we are in, and I think Masa holds us to a very high standard, is which deals did you miss as well? Because I believe whether it be the Chinese ecosystem, the Indian ecosystem, the US ecosystem, and if you go back and see the data, there'll always be these six, seven companies which define a decade.

29:55and you can be the smartest VC or the smartest investor, but if you don't end up in those five, six companies, your returns will always look, you know, and I think there's a lot of tweets and a lot of texts now is like, you can be the smartest VC and do the analysis or you would have just invested in your stock and you would have been fine. Yeah. Right? So I think you have to do the post-mortem is which are those five companies which got created over the last six, seven years. But obviously the worst is if you didn't even have a look at it, right? Because that's a bigger question. But the second question is you had a chance to get involved and why didn't you?

30:29So obviously we'll do the postmodel of the stuff which has gone wrong. But I think I also think let's do postmodel of what we missed and what's our NT portfolio, because that's where we could have kind of, if we got one of those five companies, the rest kind of been better. Wow. Something you said made me think about your divestment strategy coming in at the stage that you do. And oftentimes, obviously when they're acquired they're they're gone and done typically but when when you do when you go ipo do you tend to do you have like a rule that we sell at the you know as soon as we can that you give it to the lps or that you that you decide i think on a case-by-case basis you know some like as a firm we've held we had alibaba for a very long time as a firm we obviously holding uh we've exited out of Uber, we've exited around some other positions, we've exited around a policy bazaar in India, where we made a handsome return.

31:28So I think it depends on case by case. But at least my view is that a lot of stars have to align to give you a moment to exit. Some of it is in your control, some of it is not in your control, right? And I think you have to be disciplined enough. And as disciplined as you are going in, you have to have the same discipline coming out. And because what happens to us as VCs or tech investors, we fall in love with our companies. We think it's compounding. We think it's going to last forever. But you have to realize the reason you back this company is because they were disrupting and incumbent. And so the other way around, someone else is going to be after your company and they will, by law, they will get disrupted.

32:10And that's why the exciting thing we can take. So you've got to make sure that you have the discipline to take capital off the table at the right time. And obviously we have a fiduciary duty to ILPs to return the capital as well. But if you're not, then it gets you into trouble. Sumer, you just said you can't come into this business laterally, which I take as probably shouldn't go from an operator role into a GP role. You need to go at least some part of the investment journey before you can step into the partner's shoes. Could you maybe, like because it's something we see quite a bit, right? We see quite a few funds hire ex-founders into partner level roles.

32:58I think it's a bit of a controversial statement. No, so I think, look, it's, and I think VC might be a little bit different to growth equity. So, but, and you know, and even in my previous film, we had operators come in. And I think that's a bit, And I guess, and also there in the VC world, they have a different between a VC partner and an investing partner, and I think they all work together. So you do have founders come in, and I think they are super valuable. Because I always joke, actually, when some of the founders call me and say, how many direct reports should I have? And I'm quite honest with them.

33:33And some of the ones that have been super friendly to have been on the board for a while, I say, look, I'll give you my advice versus the rest of the 35 investments I've done in my life. But in reality, in the buy side, the grand total of people which have reported to me is probably 30 people. So we are always small firms, whereas you've got an organization of 10 ,000 people or 5 ,000 people. And so I will find you the right operating person with the right operating experience to answer that question. Because it's a different answer. So they're obviously super value-add. But I do think when it comes to investing, as a founder, you have, or as a person who's come from a corporate setup, I don't know how black or white is the money in versus money out.

34:17Right now, business is quite black and white. You put the money in after five years later, you know, is it done well or not? And there's limited amount of capital. And most importantly, there's limited amount of control. So as a founder, you have 100 % control over your fate, who to hire, who to fire, head of sales, head of revenue, head of product, head of engineering. as a VC, as a 5, 10, 15, 20 % shareholder, you are kind of batting, you're adding value, but you don't have full control. And so that experience of how to make things work, find the right entrepreneur, where you will not necessarily have full control is not straightforward.

34:55So when I see a lot of founders or operators coming in, I'm like, look, if you're a 20 % shareholder, depending on the relationship you have with the founder, they'll be open to listen and they'll open to get you under the hood, but it's not your company. If the founder believes this is the right CRO, then he's the right CRO or she's the right CRO. And I think that's where you need the experience to figure out, come through the ranks and say what will work, what will not work. And then you add the more nuances of what shareholder rights I need, what's the right valuation, how will early stage investors and seed investors or late stage investors behave differently when there's an M &A outcome.

35:32If there's a prep stack, you know, the incentives are not always aligned. If I'm on top of the prep stack, I'm happy to take a price. Someone sitting below the prep stack will not be happy to take that price. So those, you know, workouts, you need experience. It's not straightforward. I think that makes a ton of sense. Take a start.

36:00Now, I'd love to ask you, because we've had Sarah Drinkwater on the podcast from Common Magic, Solo GP. Actually, she is a finalist down in our newcomer category in the European VC Awards. So big shout out to her for that. She said, a little bit of chaos is good for you. I'd love to hear your take on that. Oh, yeah. No, no. I 100 % agree with that. I think, especially in tech investing, If there's no chaos, then you're not finding a solution. If you're not finding a solution, then technology, the oomph of technology or the wow of technology is not there. And at least for me personally, it's the chaos which takes out the hustle in you.

36:43It's the chaos which takes out the entrepreneurial spirit on you. It's the chaos which provides the opportunity. and I think if I look at my journey or my recommendation to anyone's journey is that if the 2007-8 crisis did not happen then maybe I would have never left Goldman Sachs because Goldman Sachs was my dream job to get out of university but it was a chaos and my boss was leaving and I was like, okay, let's take this one or if you come to India, if you ever visit India it's not as structured and the infrastructure is not as A plus as Europe So in that chaos, you've created, you know, multiple$10 billion plus tech outcomes.

37:23And in that chaos, you've got the cheapest data in the world with 900 million, you know, mobile phones and everyone having access to YouTube on their phone. And I think that's what creates the opportunity. Otherwise, you know, I always joke with the team that, you know, if there was no chaos and there's no risk, then we should just invest in a toll road asset. You know the traffic every day. you get a cash flow people pay the toll but that's not what we want to do i mean no no no no no no offense to people who invest in toll roads but you know that's not you want the chaos to have the excitement and it's high risk companies will go to zero like you said some swings we take will not work out but then you will have um you'll have doordash and you'll have uber and you'll have job in Thailand and you'll have other good outcomes.

38:14I have to ask you because you just spoke about India and the chaos in India. And I've always been fascinated by India. So now I'm just walking down a tangent that is probably only going to be a pleasure to myself. So sorry about that for anyone listening in. But I'd love to ask you, Sumer, what about India has just like kind of completely swept your feet away? Because I can only imagine, I haven't been, but I'm definitely going. No, no. I'll tell you what, obviously, we've been, last 10 years or so, we've had a very stable government, a government which has been very pro-industry, pro-tech, and pro-infrastructure.

38:54So that, pieces have obviously come together. But I think what really amazes me about India is the depth of the entrepreneurial spirit and the hustle to get stuff done. Right? It's a fast-changing, economy, infrastructure is becoming better, but it's obviously not like Europe and the States. Rules have to change. The government is, permission, et cetera, take a bit of time. But in all that, how people, how entrepreneurs, both whether you build the largest telecom company in the country or the biggest food delivery app or the biggest e-commerce app, how in this kind of super fast, dynamic, changing world, at that$3 AOV, which is not$4 AOV, which takes a lot to build a business, how entrepreneurs have kind of hustled, worked hard.

39:47Also in an environment, in a VC environment, which was very young, right? If I go back in 2009, 10, the first like a 10 or 20 million dollar deal was a massive check in india right and now kind of everybody wants to raise a billion dollars so when you go to india you see how people are making ends meet or making businesses work with that kind of hustle which is just phenomenal so and when you go into when you fly and you know maybe we can go to the other ones and one day you go to banglore you go to delhi you go to mumbai you know the big investing tech hubs and just the energy you see on the ground is quite phenomenal.

40:28I can only imagine. What do you think has made SoftBank successful in India, considering that we've had, at least as I remember the story, we've had quite a few US funds go and then kind of retract a bit. So what do you think allowed SoftBank to be so successful? I think three, four things. I think one from the top, I think Masa is a big believer in scale. I think he's, you know, he's got a good relationship even with the prime minister. I think he's a big believer in India. I think that that helps where we have a long-term focus and long-term commitment to the country. I think second, you know, I think everyone's taken advantage of the macro in India.

41:07But like I said, you need to double click on the micro. But most important, this is my view across investing, is you need experienced boots on the ground. I don't think anywhere in the world, whether it be Europe, whether it be China, whether it be Silicon Valley, that you can be an investor flying in and out. And I think if you're not committed to open an office on the ground, to build a team, to find a team which is experienced and done it for 15 years or 12 years on the ground. So I had started investing in India in 2009. I was hired by SoftBank in 2018. So you came with a network, with an ecosystem, et cetera, and more experience to really look around the corner of, because the macro in India always looks phenomenal, right?

41:54So if I give you stats on, I don't know, number of teachers per capita, number of hospital beds per capita, data consumption versus China, you think it's amazing, but you really need to get into the micro. So that's one. I think that's kind of been, we've been lucky with the right team and then the discipline of making sure we don't overpay, similar to Europe, right? Most of the outcomes there are four to five billion. So you've got to make sure you come in at the right value. And don't think of always India as a four trillion economy. Also think of it as a$2 ,000 per capita economy, which tells you the real purchasing power.

42:27So don't get carried away with all the euphoria. And I think that's, those are the, I think, three, four things which have been important. And I think to my point, and I always say this is, the reason you need people who know the business, and I was saying you can't hire them laterally, or you need boots on the ground is because I firmly believe that firms get you into the room, but the deal happens by the people in the room, right? So definitely the SoftBank calling card is a very, you know, strong visiting card to have or any of the great firms. But once you're in the room, you know, the relevant people need to make the deal happen because good companies will always have multiple term sheets and to convince them to take yours, you have to have that personal wrapper on the ground.

43:15You said boots on the ground is super important. And that made me remember that I didn't ask you before, and I should, could you just outline the organization of SoftBank in Europe and India? How many people, what functions, which locations in Europe? Is it only London? Same thing in India. So we obviously had the Vision Fund, which we are part of, Our CEOs are Rajiv and Alex Kaveld, the CEOs of the fund. And then you have kind of managing partners across various regions running different regions. So I look after Europe and India. So I'm back and forth quite a bit. My family, et cetera, is here.

43:55In Europe, we have 12 people on the investing side, including me. And then in India, we have six people on the investing side. So that's kind of the team. and that's both across Vision Fund 1 and Vision Fund 2. So that's kind of the core team. We have about, and I'll get to the exact data if you want, but we have about 35 odd companies in Europe and we have about 22 companies in India. So that's kind of the scale. Yeah. And then in Europe, why are you all in London? How do you think about, like, do you sometimes wish you had someone? So we're a small team. We're a small team and the team is divided into a level of specialization between B2B, B2C, FinTech and SaaS.

44:46So we have different direct department level people heading those teams. And then you have teams below that. We had two choices. I guess we all have two choices. You can be, you can open an office in Paris. You can open an office in Berlin. I don't think we need many more people than that. And so then what will happen is you'll have a couple of people in Berlin or a couple of people in Paris or a couple of people. So, which I don't, I mean, this whole business, and we can get into a debate of how many times a week should people come in from work from home versus work from office? That's a lot of views.

45:18But my sincere, like, philosophy is this business is all about ideating. There's no right or wrong. And so, I think my preference is for everyone to be in the same office. Obviously, everyone is traveling a lot to Europe. You have the sector coverage, but you also have geographic coverage. So people are responsible and they need to be in their respective geographies quite a bit. But I do think all of us sitting together, meeting three to four times a week is super duper essential when it comes to ideating, debating, thinking. I think I would rather go with that model than have multiple small offices where we're not touching and feeding each other.

46:00Yeah, completely understand that. I don't like it in many cases for seed stage. I think it's tough for many to do well unless you have a very established brand. So our backer of Seedcamp, as an example, they've nailed it, right? But they also have a brand that, as you said, you have the calling card that opens the door anywhere and they have a big built out network and so on. But if you're a younger team or less established team, there's no way you're going to be able to cover Europe from London. So yeah, but at your stage, I completely get it. But I wanted to have the conversation.

46:46Now, talking about Europe, I'd love to ask you to give a shout out to someone that you love in the ecosystem. Okay, we've got many boards. I think Invest Industrial, they're not, I wouldn't say they are classic tech investors, but they're with us in Remark. I think they really understand the subject matter. They go deep into it. A lot of maturity on the board, a lot of experience. And I think add a lot of value both to the entrepreneur and to the ecosystem. And then we have, you know, we've got a big French portfolio. So we've got Partec and BPI at France. We work with them a lot. I think their ecosystem, their network, their ability to kind of find the right founders, especially in the French ecosystem, it's been quite phenomenal.

47:31So we've got a lot of overlapping investments with them. And then who else? Shinnevik, we work with closely. We've seen them on a couple of our boards with Job and Talent, with Travel Perk, very thoughtful, mature. So I think these are some of the top of mind where we enjoy working with these funds. And that's important. Actually, that's important. One of the things I always tell the team is that we have three clients because everyone thinks on the buy side, like who's your client, right? We're not necessarily in the service industry, but our clients are obviously our LPs, the founders, and most importantly, I say it's the VCs.

48:12Because if you don't treat your VCs as clients, you will not get into the best deals because the relationship, and in Northwest, I used to be a little earlier stage, Series B, Series C investor. And the relationship with Series A, B, C investor, especially A &B, have with the founder, we will never have, right? Because we've come in when everything is kind of not hunky-dory, but in a decent shape, right? And like I said, good companies will always have multiple term sheets. And at that time, you need the seed or the seed of the investor to say, we think SoftBank is good. We've seen them in action to win the deal.

48:49So it's very important for us to have a very good relationship with the VC across Europe.

48:57On that note, do you have some pointers for VCs that are prior to you that how should they best engage with a player like SoftBrain? So I think for us is we try and meet a list of our VCs across different regions, at least one supporter. So if we are not meeting you, then please reach out. We should. Where A is we share what our investment thesis is, what we are seeing. We love to go through their portfolio, get ahead of the curve before the launch of process saying, OK, these are the companies which are doing well. Even if there's no deal, this is the entrepreneur you should meet. And I think that way, at the time when there is a deal to be done, both the board member from the VC as well as the entrepreneur has comfort on, OK, these are some ones who have been tracking us for a while.

49:48So at least once a quarter, we've divided the world by region and by sector, kind of the VCs we should be in touch with. And someone from the team is responsible to catch up at least once a quarter. I always like asking that question to later stage investors because I think it's so integral. And what you said, it's a very networked industry. So taking care of your coin investors is so integral. Now, let me ask you a completely different topic, kind of going to your own formula for investing. And I think I'll just kick it to you like that. And then I'll let you kind of describe this story as you want.

50:21Okay. So the formulas is, like I said, we have to be proactive and reactive. I will not want to do a deal if I've met the entrepreneur while the process is kicked off and they're already term sheets there and we've been asked to match a term sheet. We should, number one, I'm not that fussed about which sector we should be in. I think it's too dynamic. So it's not like, okay, we don't like fintech. We like B2B or we like SaaS and we like health tech SaaS. I think that you have to keep your mind quite open because things keep changing and you need to be dynamic. And therefore, you split the team in sectors, number one.

51:02Number two, if you haven't met the company or been engaged with the company for at least 18 to 20 months, I will not be keen to do a deal. You need to see the entrepreneur in action. You need to see what he promised, what they delivered. You need to get their MIS, correlate, cohorts, CAC, retention, revenue growth, whatever you've been sharing. And then when you've seen them over 18 months, at least there is some credibility on your thesis or the model you've got to build forward. So that's the second bit. Third bit, like I said, is you don't want to go against the macro tailwinds. Oh, sorry, headwinds.

51:40So if it's more than a billion, billion and a half post money, you really need to understand and think about why. Finally, we need to deep dive and at least speak to seven to 10 employees or ex-employees off the record to really understand what's happening in the company. So go to LinkedIn and see who has resigned from the company recently. Try and reach out to them. Why did they resign? Is it a manager issue? Is it a cultural issue? Is it, is it, uh, the product is not doing well or whatever it, whatever it might be, because, you know, entrepreneurs, uh, if that's their job, they will sell you a dream and you have to come out of that meeting, not too excited and trying to decipher what, what, what, what, what, what the truth is.

52:24Uh, so I think if those, all those circles don't come up and then also, like you said, the VCs, one of the other yardsticks is, are there A plus high quality VCs on their cap table? Have we worked with these VCs before? and then try and figure out the board dynamics because there will be many moments where you will have disagreements with the founder and good debating disagreements. And you've got to figure out how the board is incentivized to make the right decision. Let me just ask you about that, speaking to the competition or looking around the corner point, how early do you engage? Is it like if you do a Series F, would you then have met the company for the first time at their series a or at least know about them not a but at least around before i mean ideally if i had to and you know and this is the playbook you have to you have to keep fixing the book but ideally looked at it the round before thought the company was too early for us or the valuation was too high or you had some doubts you passed on that round watched it for another 18 months and try and preempted the next round that would be the perfect kind of play role.

53:34And now obviously it'll be, it'll be a bit plus or minus. And the other thing is you really, you know, the entrepreneurs are obviously always larger than life, you know, figures. But I think one of the things which is big learning for me, some people say, oh, if the founder cannot be CEO, don't back them. I think that I don't buy that because I have seen a lot of founders grow into the role and what they were four years ago and what they are today is they're, you know, dramatically different people when it comes to maturity, especially how to handle the organization. But I think what can't change, which is very important, is the CEO has to have extremely good communication skills.

54:13And by communication skills, I don't mean they need to give a presentation in front of 100 people or give the best pitch in the world. They need to communicate internally what the direction of the company is. because when the company is growing that fast and it's dynamic and there's competition and you're trying to replace the incumbent, a lot of the times where I think I've gone wrong is where it's all in the entrepreneur's head and he or she has not really been able to communicate it to the C-suite or to the organization or where are we going? And then you lose crucial time. So the ability to communicate that vision is very critical.

54:51I'd love to ask you, because you sat the CEO a couple of times, you didn't say the founder necessarily. So I'd love to ask you, what are your philosophical... No, so I think the founder, I mean, we come in backing the founder who's generally the CEO. But I always believe when you meet people where we are co-founders or there are multiple co-founders, my question to them is, who is the CEO? I haven't seen the multiple co-founder model work out perfectly. there has to be one of them who is eventually making the decision. And so you can call them founder CEO or by CEO, I don't mean you want to replace the founder and bring in the CEO.

55:34I think that rarely happens. But when you come in and oftentimes it would happen before you arrive, but when you come into a company, look at a company where it's not the founding CEO, but it's a hired gun or so to say with a noted word, what's your take there? Are there any specifics that you're like extra careful about? Yeah, I think we generally, if I go through all our companies in Europe and India, we've not backed a CEO. We normally backed a founder who is the CEO. I think that's kind of been the formula. But if there is a CEO in place and there have been opportunities where there have been CEOs brought in from outside, I think it's a bit about how stable the business is, right?

56:15Because if you are coming into a super competitive dynamic where technology is changing very fast, I would be apprehensive to back a CEO. Because in that environment, you need a founder, right? And if the CEO says, I've come from a corporate setup. So I'll give you an example, right? If you take a food delivery app or you take an e-commerce app, like when I speak to the founder or the CTO and the founder together, they are running, I don't know, 10 experiments a week on the app. This is for Android. This is for iOS. This is for income bracket X. This is, I'm doing a beta for income bracket Y. There's a bug here.

56:57Let me give this extra feature. When I speak to a CEO who's come from a corporate setup, he'll say, well, I will update the app in the next quarter board meeting, right? And I'm like, if you want to wait for the next quarter to update your app, I'm going to lose like 10 % market share, right? And so, I mean, it's a mindset change where they work quarter to quarter and a founder works day to day. And so depending on how dynamic and stable the industry is, you need to back the right person. So I would say majority of the companies will do it. It's a founder because it's not like they are the established Unilever P &G and it's a duopoly or whatever it is.

57:35And the business is very stable. That's incredibly good statement. I've never heard that before. A corporate CEO works quarter to quarter. A founder day to day. I like that. That's a very strong quote. So in our notes for this, you have a case study on a food delivery that I'd love to ask you to dive a bit into Uber Eats, Swiggy, DoorDash, disruptors in this space. Sure. So I think, look, Swiggy is dear to my heart. When I was in Northwest, I did the Series B when they were doing about 800 orders a day. and they were basically in one locality in Bangalore. Fast forward today, they do close to 3 million orders a day and it's pan India and they're doing 3 odd billion dollars of 4 billion dollars of throughput.

58:26So I've seen that business and industry grow dramatically. I came back into Swiggy in 2021 as SoftBank. It's a duopoly in India between Swiggy and Zomato. and I guess there's lots of learnings and I think going in obviously it was a lot earlier than what we do today at SoftBank but going in I think what the learnings of success was there was a very key thesis which luckily played out and back then the the biggest delivery company in India was Domino's Pizza and then I kind of went and did some research saying I think Pizza Hut delivery pizza is probably higher quality pizza than Domino's. But why is Domino's like 80 % market share and Pizza Hut delivery is, or, you know, the other pizza brands are not great.

59:15It was solely because Domino's delivered food in 30 minutes. And so there was no, and there was no app. So you had to call up a number. They kind of took your postcode. They found the process Domino's. This was in 2012, 13, and the food arrived. And I was like, okay, if the USP is to get food in 30 minutes, I mean, as long as the food is 90 % of the same quality, then I need to find the entrepreneur who was focused on speed of delivery versus choice of delivery. And there were many entrepreneurs, and even in Northwest, a lot of people didn't buy the thesis, but we luckily went ahead with it, was like, let's not do full stack.

59:56Let's just put all the restaurants in a platform and let the restaurant handle the delivery. Right. And my thesis was, well, that's not what the reason why Domino's is winning is because they handle the delivery and the food comes in 30 minutes. So, yes, this is more expensive. Yes, the economics are worse. But at scale, this is what's going to work. And when I met Harsha, the founder of C, he was very clear. He actually started a company as a logistics company and then became a food delivery company. So his head was always logistics first. and he was like, I need a full stack because the restaurant doesn't have the time to handle delivery boys because his first preference is to give a wow experience to people sitting inside the restaurant.

1:00:37And then the delivery is kind of second. I mean, this is back in 2012. Now, delivery has become primary, right? And that was kind of the connect with Harsha. And then obviously I did ref checks on him. You know, he went to IIT, which is like one of the big engineering colleges in India and the people he hired around him. I spoke to some of his ex-batch mates and I was very clear that in India, like I said, you've got to hire a lot of people. So I needed someone who was a little more dynamic, fun to work with. He was very well regarded in school, very smart, but also the cool guy to hang out with.

1:01:10I said, look at him, he'll hire the right team. And so that's why we backed them. It turned out to be more expensive. It took a lot more money. It was us, Accel and a company called Elevation then came DST then came NASPERS then came Bessemer so there was a whole host to kind of happen and then like I said the micro was fine but we got massive Indian tailwinds where as India became richer the first thing you do when you become richer the country is order food from outside right before you start going for holidays to Europe the first thing you do is you eat out and the younger population migrant population and so all this kind of macro kind of worked out do you know why that is?

1:01:50oh why? I think it's, if you go back, I think it was a Goldman Sachs report in 2012 when I read it. It says, what are your preferences when you go from a$1 ,400 per capita economy to$55 ,000? So the first thing you do is eat out, go to the cinema. And then as you become richer, you take holidays. And then you become, as much as you become even richer, then you're like, okay, now I need plastic surgery. You know, I want to go to some cosmetic surgery. And so there's this whole curve of how much disposable income you have. So the first thing you do is, I want to go out and watch a movie or go out to a theme park or go out to a food or whatever.

1:02:29So that's kind of the dynamic of why Swiggy worked out. I think the big learning was full stack. You were ahead of the curve in thinking about full stack, some intellect, some luck. It took a lot more capital. So we actually got lucky that people supplied us that capital. There were moments where the capital wouldn't have arrived and the outcome would have been very different. it is in a consumer business, you have to be ready for a big fight because while Swiggy and Zomato were the two Uber Eats came into India, Food Panda came into India. And so you had this time where people were burning crazy money.

1:03:03And so you survived because of execution and capital. You did experiments which didn't work out. But I think most importantly, Harsha as a CEO, like I said, his vision was communicated properly. And he really built a strong team because like today they do two and a half million orders a day with about i think 200 000 delivery boys running around india uh that's just a lot of logistics to manage and you know and and you need people around you to do that so that's kind of a little bit of the swiggy swiggy journey yeah it's an incredible story we don't have too much time we could have dived so much I love to talk about scaling companies.

1:03:42Like, is there any transition from being in India to going to Europe? Why is it difficult and all those things? We don't have the time, so I won't dive into it. I'll give you the one line answer. It's hard for Indian companies to go in, especially the consumer where you need to handle all of the logistics, IT services, you know, pharma export, that's all fine. You're doing it in India, you're sending it abroad. Services, but it's hard. I think the dynamics, I actually think it's hard for, like you've seen it in Europe, for a food delivery company to go from England to Europe or from France to Germany or Germany to the Nordics.

1:04:17So coming from India, this is a very different. Yeah, I imagine. I imagine it's very, very different. Okay, now, because the reason why we were in a rush is that I would love to ask you about the three biggest learnings from the last 10 years in your life. And especially because I know you're going to talk a bit about reflections on family and health. And I think that's always interesting to open that side of our guests as well. So I think three biggest learning. I think one is when you are kind of in this dynamic world, you've been given a good opportunity, you're seeing a lot of stuff. I think the first thing you have to ask yourself, and this is what I tell the entrepreneurs also, is what not to do.

1:04:54You cannot do everything. And you really have to understand is you will be shown 200, 500 ,000 deals a year. you cannot give justice to seeing all of them properly. So what not to do? So if I am not interested in a company below$100 million revenue, then you stick to that and you will have to have some focus. Otherwise, I don't think you want to get anywhere. Number two, the importance of EQ and relationships, I value a lot more than IQ. I would say EQ relationship and discipline. So when I interview people or you're hiring or I think everyone around us in this industry and everyone's got a everyone's smart everyone has got a basic level of of smartness but i think where you win is discipline and hard work and most most importantly is eq because this whole business whether managing the ceo winning the deal finding him the right team is a lot to do with with with eq and so that to me is is more for i think uh who said this i can't remember it's it's not my code but it's like you do the the airport test who do you want to hang out in the airport with right and when you intervene and if that if you don't want to hang out with this person in the in the airport when you're stuck and traveling around the world they shouldn't be bothered and i think the third big kind of is is what you said is yes work is important yes it's it's critical you spend 50 percent of your time in the office you got to make sure you like it, but you have to, at least for me, when I interview people, is what else, right?

1:06:32Do you like tennis? Do you like hiking? Do you like playing music? Do you just being with your family or your kids? Because you need that time off or you need to be more fun or even be more dynamic than just coming every day and thinking about, you know, what's the next big AI ideal we've got to chase. I think those three for me are very important, at least for me personally, and I think that's the kind of, when I look for teams, that's important. Any reflections on life? I call it life design because I believe we have a lot of agency in our own lives, especially if we think 10 years ahead for ourselves.

1:07:12And it's not just about balancing out that I ended up in this situation on the job and this in the family, and that you can actually say how do I want it and then build towards it in 10 years. But how do you think about that for yourself, Samir? I don't know. I think this is the only discussion in my head when we look at companies is, do you make many small decisions or do you make three big strategic decisions? And I don't know if you read the psychology of money, right? I don't think you can make three big strategic decisions because life is just too dynamic. And I think if I had made three big strategic decisions, it would have been a very different life.

1:07:48So I think I've made you just make many small decisions, you know, that actually you kind of know where you're going. But I think many small decisions is more fun and keeps your brain a bit lighter, less stress. And I think it turns out better. So, yes, in hindsight, 2020, we should have taken more risk. Could I could have joined a corporate? Should I have gone and invested in Tencent in 2006, et cetera, et cetera. Sure. But I think what's what's worked out well for me is at least like Someone tells me, what's your five-year vision? I'm like, I don't know what my five-year vision is, but I'm making small decisions every day.

1:08:23And that's more fun. What I believe in is directional guidance for yourself. So I also have no idea in five or 10 years. Since we founded EUVC and have made some LP investments, there's probably some people that have joined us in those investments that would say, dude, one thing you are going to do is going to manage my money, bro. But I do believe very much in that directional decision making. And I think that, and this is where I would love to ask you about the family perspective, because obviously being a managing partner at SoftBank and being in the UK, in London, and at the same time also in Bangladesh or in India, I can only imagine that being able to kind of like be where you want to be and be the man you want to be?

1:09:17Is it difficult to ask? No, it's difficult. It's difficult. It's also difficult. You obviously have a kid. It's like, I think tomorrow or the day after, there's a cricket match and I can't make it. I need to go somewhere. But I think it is, I guess, certain rules. You try and at least make sure the weekends is non-negotiable and you get full commitment. I also find with the family is, you also have to have an understanding wife and family. And that's part of the reason why you're successful. But I think when you're committed, then you're committed. So I think when you give that time to family, then you have to be very clear that, you know, life is not going to be dramatically different if for two hours I don't pick up a phone.

1:09:55So when you're committed, then you're committed. And it's not easy to balance, but be committed when you're committed. In your head, I think some of it is non-negotiable. You have to do it because eventually, you know, family is super important. And I always find that you figure out the time at work to make up, right? Because I mean, I don't know about you, but if If you go to office, I would say 30 % of the time I'm wasting my time in office. So either I'm putzing around or I'm going for a coffee, which I don't have to go for, or I'm talking on the corridor, which I really don't have to. So, you know, if I, hey, you got to do it the other way.

1:10:31Say, okay, I want to spend this extra 30%, and when I come to office, I'll figure it out. And normally it gets done. Many say, how can you and David, we're two guys and we do the UVC podcast and everything alone. and I think that a big part of our superpowers that we don't have an office, right? I'm in Denmark doing everything at home. David is the same down in Portugal. And that is just, I have two small children, right? That allows me to actually be there to set them off in the morning and then be there again at around four and then back for work sometimes in the evening. But when you're fully focused for eight, nine hours per day, you can get a lot of stuff done.

1:11:11No, no, for sure, for sure. And I don't think like we maybe, and I'll just joke that the finance people, we take ourselves too seriously. We think we're changing the world or we're not. The founders are changing the world. So, you know, if we take a day off here and there, it's not going to be the end of the world. The world will continue. Soft time will continue. Everything will be fine. Yeah, I absolutely agree. And now, the quickfire.

1:11:45Okay, now I want to ask you, you're, you know, it's very much in the same vein. So your advice to yourself if you met yourself 10 years ago. Try to be even more unstructured and kind of go with the flow a little bit more. I should have taken more risk. You know, you have the right building blocks. You have the right decent education. You'll sort itself out. And buy 10 cents. 100%. And by-testing, yes, 100%. Don't overanalyze and don't overthink. We have a bunch of emerging managers always listening. So I'd love to ask you, what would be your key advice to emerging managers that are racing? So I think, like I said, you have to figure out what not to do, right?

1:12:30A lot of times when people come in and say, I'm going to do a bit of this, bit of that, I think it has to be very succinct and clear on what the edge is. And going out, you have to have a very clear exit strategy so a lot of times when i hear when people come in you know i don't know they need some guidance or whatever we chat i'm like this is all great going in like what you haven't told your lp is if you take a model portfolio right how are we going to exit this like for example you know can europe have more than four billion dollar outcomes is the european stock exchange deep enough it's just going to be an m &a exit because it's all great going in and obviously very hard to predict going out.

1:13:11You have to have the same thesis and conviction on exit as you have on entry. Yeah, completely. And that's something that we have all learned in the ecosystem lately. Most counterintuitive learning since you started as a mantra. I'd love to hear that. Most counterintuitive. Yeah, I think the TAM and SAM analysis make no sense. I think they absolutely make no sense. The amount of time we spent trying to figure out the TAM and spam, SAM and hiring consultants and number of potential consumers and how much of them will convert. When the technology takes off, either it takes off or it doesn't take off, the SAM and TAM is totally irrelevant.

1:13:51I'll give you a classic example, like you've seen EdTech in India. We've got some bets, you know, everyone thought, oh, EdTech Global, everyone thought, you know, COVID's here and EdTech is the way forward. No one's going to go to college again no one's going to go to school again uh and you did all this analysis about conversion from offline to online uh covid went away everyone's gone back to school right and so no one is interested in ed tech anymore same way food delivery right everyone thought no one's going to do it but it's become become the norm or or or or airbnb i remember meeting a uh i won't tell you the name but the early stage vc founder who who met a airbnb at seed or series a and they said you know they passed on it i said why did you pass on it he said how could i ever imagine i'm going to let my daughter stay in some random guy's house across the world yeah i said this is absurd right well then now everything is perfectly normal so and you probably did the tam or sam analysis saying there's so many hilton hotels in europe and how much i would convert to you know it doesn't matter yeah yeah completely

1:15:00Okay, let's close on a controversial opinion, Simber. If you are overly founder-friendly, it will probably end in a sub-optimal outcome. People say, we are founder first, we are founder-friendly, we kind of let the founder do, we'll be very supportive. Yes, you should. But at the same amount, same time, there's a line that you need to, the founder needs to have some responsibility to the shareholders on the board. And I think if you, in this quest of a high founder NPS, you let the founder keep getting away and kind of not adhering to the capital he's raised or they've raised or she's raised with the board, you kind of create larger than life founders, which eventually I think will lead to a suboptimal outcome.

1:15:45Do you think, because we spoke about the discipline that investing in Europe requires, because we don't have as big outcomes as in the US, do you think that this is why this is extra pronounced in Europe? Because I do think that it is. And that means also, I think we've had less of the same outswings on founder centricity or founder friendliness in Europe than they have had in the US. No, I think it's like I've seen this across, you know, a portfolio of two firms. I've seen it across four or five regions. I just think when the times are good, up rounds are happening. I think we all kind of give the founder this free hand, which is very hard to rein in.

1:16:33And the problem is also the blame is also with the investors. Times are good. You let the founder do whatever they want. Times are bad. Suddenly you become like a big corporate board. and then you are changing your colors overnight, which the founder is also finding it difficult to manage. So you shouldn't let it go to that extent out of control because draining it back in is very hard. As parents, we see it every single day and night that times we let the kids run wild and in a second they will be crying in the living room somewhere falling down from there. Exactly, exactly. So it's not very different, right?

1:17:06You have to discipline your... It's tough and they won't agree to it, but to some extent you have to do it. I think that's a good learning for us to end up. Thanks so much, Samir, for joining us for this episode. It was amazing. And it's a pleasure. Thank you for taking the time. And to everyone listening in today, I do hope you enjoyed it as much as I did. If you did, do make sure to follow the part and subscribe on EU.BC. Here's a few words from our beloved sponsor. This episode is part of a series dedicated to raising venture funds across Europe and come together with the launch of the European VC Fundraising Bible.

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