Perseverance is Still the Name of the Game

The pandemic has surely damped the sprint of Indian startup ecosystem, not only by engendering crises for budding entrepreneurs, but also by generating apprehensive thoughts in the minds of aspirant entrepreneurs. It’s been a common trend to postpone entrepreneurial plans, thus the slow rate of new startups. It’s no rocket science that the downward spiral of funding influx is also influencing this trend. The startup data tracker reports that Indian startups managed to raise only $354 million across 34 deals in March compared to the $714 million secured in February across 46 deals. It however is too early to predict the long-term impacts of coronavirus, but the startup ecosystem in India could anticipate a positive turn of tides by the end of the year.

According to Chinmaya Saxena, Venture Partner & Lead of Strategic Platform Initiatives at BEENEXT, this predicament is bound to change as all the stakeholders start to adapt to the new normal. We engaged in an exclusive interaction with Chinmaya, who dips into his more than two decades of experience in operating roles in the industry and now wearing the VC hat to understand the environment for entreprenuers today.

Considering the substantial growth of start-ups all over the country, how is the venture capital ecosystem being instrumental in the all-round growth of newbies?
The Indian start-up ecosystem has demonstrated resilience and a strong bias for action across the spectrum. Especially at a time when the funding process is taking longer due the change in the way meetings and pitches are happening amidst this pandemic. It is our view that there is no lack of funding in the ecosystem for upcoming startups. The VC community has also remained very supportive of the portfolios and have not backed off from bridge funding to ensure longer runways for the companies to tide through the crisis and emerge stronger.

Taking the example of what we have been doing with our portfolio for the last three-to-four months, we have been partnering with them for continued growth, ensuring that they not only survive the crisis, but are also better prepared through it. We have an open and collaborative relationship with all our founders. We work with them on growth hacking ideas, strategy, and increasing runway among others to continue on a positive trajectory.

Which are the verticals in the business ecosystem of India that are attracting more investments compared to others amid the Covid crisis? Why?
There is definitely a lot of activity in some verticals that seem to be seeing investor interest amid the COVID crisis and will possibly continue to attract funding. These include health-tech, edu-tech, video content plays etc. We at BEENEXT continue to believe in the long term opportunities across a wider spectrum of sectors in India whether it’s Fintech, Agritech, logistics or AI driven businesses in general. The world of SaaS Startups is also getting stronger day by day. The digital innovation across sectors is the need of the hour. We strongly believe in the die-hard attitude of the start-up community and are confident that solutions for a post-COVID world will also come from them.

At this moment, what are the major risks involved in funding an idea and taking it to the road towards success? Also, how is Beenext coping up with the Covid-19 crisis? Is it making any shifts or alterations in its funding process?
It’s not about facing the challenges, but more about adapting to deal with the challenges over a period uncertainity. Challenges in building a business will always exist. What is crucial is how the founders see it. Together with founders, we see this not as a long term obstacle, but a different way of operating. Just like other businesses, we are also adjusting to the new reality. The real challenge is staying connected to the rapid changes, while having an understanding of the impact. When it comes to risk management, we largely share the burden with our portfolios and are always there to support how they want to address them. We are supporters and the founders will always remain as the drivers of these decisions. When we see a broader risk, we actively step in to share our perspectives with the founders proactively.

At BEENEXT, we have completely gone online and are adjusting to the digital interaction with amazing founders. We are, in fact, investing more time in collaborating and driving efficiency through positive interactions without compromising on the time spent with a given startup. We continue to be in awe of founders who are persevering strongly based on their vision even during these challenging times.

VC funds smell new start-up opportunities in a post-Corona world. What will be Beenext’s upcoming course of actions?
As active supporters of founders, we are always on the lookout for good opportunities. This pandemic has pushed all of us to think outside the box and to adapt fast. We can definitely expect digital and hopefully a green recovery-focused trends as well as solutions in the coming months and years. We will continue to provide our holistic support to nurture and collaborate with the start-up community through this journey of learning together.

What would be your advice to the startups struggling with the unprecedented crisis?
We strongly believe that the startup founders who are amidst an industry are the best people to have a full view of the situation in good and bad times. In our experience in the last few months, we definitely see the opportunity to revisit the basics and fundamentals rather than chasing growth blindly. We have learnt this from founders in our portfolio who seized this opportunity and are now in a much better position than a few months ago with a clear line of sight on positive unit economics. The second area where we have seen founders adjust is keeping a keen eye on how their customers are adapting. Whether you are a B2B business or a B2C business, supporting your customers by adjusting your business processes and support etc. during this crisis is proving to be a good retention strategy. Lastly, being unfazed by uncertainties and building your own personal resilience as a founder is a trait that will be valuable for everyone in times to come. Take this crisis as a learning opportunity to strengthen your business, your organization and yourselves.