In this episode of 100xEntrepreneur Podcast, we take you through the journey of Priya Mohan, Startup Sensei, Venture Highway. She became a VC after exiting her Edtech Startup – Vidyartha to Byju’s.

During the podcast, Priya shares her story of breaking the glass ceiling, being one of the few women leaders in the Indian Venture Capital industry. Listen to this podcast to learn about:

06:23 – Problem Statement solved by her first venture Vidyartha

11:30 – Having clarity to become a VC post-exiting as a founder

14:56 – Investing experience in Swiflearn being a parent & ex-Edtech founder

16:58 – Portfolio companies where she has led investments

19:36 – How does Venture Highway differentiate itself from other VC firms?

23:03 – “Having the opportunity to learn from Failures”.

23:48 – “The biggest bias is Confirmation Bias”.

25:52 – Pros & Cons of being a VC with a background as an Entrepreneur

34:01 – “There’s no good or bad news, there’s just news”

41:38 – Recommended read for listeners – “Principles” by Ray Dalio

 

Read the full transcript here:

Siddhartha 0:00

Hi, this is Siddhartha Ahluwalia. Welcome to the 100x Entrepreneur podcast. Today I have with me Priya Mohan, Venture Partner at Venture Highway. Venture Highway is an early-stage fund investing in seed to series A in Indian companies. Priya, welcome to the podcast.

 

Priya 0:16

Thank you, Siddhartha, very excited to be here

 

Siddhartha 0:18

So, Priya is an entrepreneur turned investor. She started her journey in venture capital in 2018 with Venture Highway, focusing on early-stage tech investments. She sits on the boards of companies and social commerce, Edtech Infratech, among others, and she is extremely passionate about working with founders, especially in zero to one phase and one to 10 phases. In 2012, Priya co-founded Vidyartha.

 

Siddhartha 0:46

That is an education technology platform for students in grades six to 12, which she successfully exited to Byju’s. We all know Byju’s is the only EdTech decacorn in India. Priya would love to know about your journey, you know, much before venture capital about your work life, how from a CA, you, you know, you became an entrepreneur and then an investor.

 

Priya 1:11

Firstly, Siddhartha, thank you so much for having me on this platform. I really appreciate it. I think my favorite way of introducing myself is to start by saying I’m from Madras. People still call it Chennai, but I’m from Madras, I think very middle-class upbringing. So as a typical Madrasi, you know, my parents were very focused on getting me to be both culturally and academically oriented. So I, you know, they tick for dance, they tick for music. And then, of course, a lot of academic kind of focus as well. I think that’s when in grade 10, I realized that, you know, my interest was so diverse. You know, I was a performing dancer at that point of time, I was very interested in journalism. So I used to write for this very local, literally around the street, kind of a platform called Adyar Times I literally begged there beat guy to write one story. So I was just thinking that I could become a journalist. And I was doing that. And a couple of other things, I realized that, you know, while I was doing well, academically, that I didn’t want to do anything in 11th and 12th, which will sort of impinging on my ability to do multiple things. So actually, took commerce, much to the disappointment of my teachers and my principal and my parents as well. And then I continue to perform and then CA happened purely because A, my dad was a CA and B was, you know, having taken commerce, which was pretty much blasphemy, you know, doing something respectable, and CA was probably considered a little more respectable, I joined CA, you know, I joined as an apprentice with Fraser and Ross, which was Deloitte in Chennai, it was pretty rigorous, great exposure, but then very quickly, I realized that I was not my personality didn’t suit it, because it was more kind of a post mortem, especially the audit. And even when I was auditing, I was more interested in the internal audit, which is like where I it gets me to be in the factories understanding how things were working rather than doing the statutory audit, which is more ticking, right the bank reconciliation and other things. So cutting the story straight to, you know, how I finished my CA, my first job was to break away from my influences, which was my father, and everybody was telling me that I should continue at Deloitte, I went straight to Delhi, found completely, completely random job, as you might call, being the executive assistant to the founder of APJ group of hotels. And one year, I literally first six months, I cried myself to sleep literally, it was a cultural shock for me. And then from there, the journey started moved back to Bangalore, I was in Ernst and Young, and then back to Chennai. And then went to ISB. In 2007, I passed out of ISB. And by then I got married, and Chennai was constantly pulling me back. Because my husband is also a first-time founder, and he had a manufacturing outlet there. So I kept coming back to Chennai. And I thought, okay, now what do I do? I think I’m reasonably smart. But this place is becoming a huge constraint. So what do I do to kind of breakaway and that’s when the whole genesis of a startup started. It was literally to break away from the constraint of the location. And then Vidhyartha happened, because it was literally the story of my life, right, which was literally if I had somebody would have advised me better would have guided me better. Probably channeled that energy, which I probably splintered across eight different directions could have been in a place better than this. So that was the genesis of Vidhyartha which was aimed at school students to give them better learning guidance. My co-founder was based out of Bangalore. So I did the first five years shuttling between Chennai and Bangalore. We build the business out of Bangalore, my daughter was two. So, 5 am Shatabdi. And back Monday to Wednesday was for the first five years of my life, when I look back today, I feel tired. I don’t know where I got the energy. But it just was exciting. And then, you know, we were very fortunate to have secured the Byju’s deal. And we can talk about it a little later, but then Byju’s happened, and then I moved to Bangalore, with my daughter, while my husband still continues to shutter. So this is, this has been a journey till Vidhyartha. And then, very accidentally, I met Samir, who’s the founder of Venture Highway. And, you know, to correct you, we don’t have kind of names at Venture Highway, we don’t call ourselves partners. So, I am just called the Startup Sensei, it just blew my mind when Samir said, I’m not going to give you titles because we really wanted to build a flat organization. But Samir was looking for somebody to lead Bangalore. And this common friend of ours introduced us and he said, okay, you know, Priya has been a founder before, maybe you guys should try and see if this happens. And what started off as a six-month experiment, I just finished two years with Venture Highway and loving every minute of it.

 

Siddhartha 6:14

So Priya, tell us about your Vidhyartha journey, like, what was the problem solving through tech in Vidhyartha? And what scale you grew in, you know, let’s say your yearly revenues and number of paid subscribers of students you heard and how big was the exit?

 

Priya 6:35

So let me start with the problem statement, I think I’m gonna cut to the pivot, because there was a little bit of the first year was more on the Discovery, essentially, a problem statement was today, parents and students were buying a lot of products and services. But very often, these products and services that they were buying, were instant purchases, which were determined by ohh my child is doing so badly so I’m going to put her on math tuition, or I’m going to get a kumana, I’m going to get a buy juice. And you would have heard most of them, you know, not really thinking about the long term impact of buying those products and services. So idea was, can we had a diagnostic platform, which was pretty powerful. where, you know, we identified the learning, you know, the learning part of a kid under four different quadrants, which included interest, aptitude, personality, and academics, and built, kept building algorithms, which were very, very specific and very tied into our boards, which is CBSE ICSE, we did very few international schools, but we did a majority of CBSE, ICSE. And we started figuring out, in the long term, where is this child likely to go? What are the subjects he or she is likely to follow? And where are the gaps from an aptitude and economics perspective, to give you an example, a child very often, in their eighth grade, or sixth grade would say six to eighth grade would say, they love, you know, to do something completely, they’ll say geologists, they’ll say, anthropologist, and all of those, by the time the same kid comes to grade 9- 10, you will see complete polarization kids are most often conditioned to just pick science which is biology, physics, chemistry, or math and computer science, or the third, you know, which is commerce. And that’s all they knew. And, and it was amazing for me, and so how kids with so much diverse interests, suddenly when it comes to just 10th and 11th, and it becomes so polarized. And when you actually break that down, you will realize that kids who are constantly been spending time on math, tuitions, and English tuitions, the gap between the academic performance and the aptitude one way or the other. So very often, you will see kids still getting 85-90 in English and maths, because we are such rote learners, when you actually ask them basic problem solving, critical thinking, or comprehension, they would be in the 30 percentile, 40 percentile. And we were creating these leaderboards benchmarking kids across a region across the state nationally as well. So every dashboard had where the kids stood within their locality within their school within the region within the country. And then based on these gaps, the idea was can we then curate products and services that are truly relevant to the kids from their long-term perspective? So if this kid is going to take 10th, grade pcmb and then post PCMB in the 12th, what are they likely undergraduate postgraduate courses? So hence, what products do they need today to do well then and maximize their outcome? So literally, we had mapped thousands of courses, map the entire undergraduate postgraduate mapping in India and gave those full learning paths and the idea was Can we build a commerce layer over it, which is curate products and services, that was the idea. And to give you an extent that I can disclose because I had very strict NDAs but we were at the time of selling to Byju’s we worked with a CBSE, we did a massive launch with cbse we powered that entire career assessment and aptitude assessment portal for grade 10 was a massive, massive launch. And overall, we managed to work with about 3500 plus schools. And by the time we sold and across India and the Middle East, and post selling to Byju’s, the idea there was given that we are a b2b2C while BYJUS’s is a b2c, is that a way that our product becomes a precursor to curate BYJUS’s product better for kids, which means identify the learning needs and gaps better so that BYJUS’s can deliver their products and services better. Um, through that journey, we both my co-founder and I, we, you know, completely focused on tier two regions, and did the b2b2c selling for them. And then again, about 19 plus regions that we were doing an average about 200 to 50 schools literally a week after our sale. So that was the long and short of VIdhyartha and where it went post the acquisition.

 

Siddhartha 11:25

Priya, post-acquisition, how did you get the clarity that you want to be a VC?

 

Priya 11:30

Um, well, Siddhartha. I didn’t get that clarity, actually, the better clarity was that I wanted to take a break. And the common joke was, every time I meet a founder, I say this right, and it’s genuinely The situation is when a founder sells and you know, everybody sees the outcome, I think, overwhelmingly, one should also realize that it’s a venture is a very, very low probability game, right? And the kind of, very often it’s also being at the right place at the right time. So that kind of gives you that gratitude. That you know, you’ve been lucky enough for the outcome to happen, all things being equal, of course, every one of us works hard, and we have this goal in life. And for the longest time, the joke would be, you know, HDFC would send me a message saying, minimum balance gone below 10,000. And for the first time, I, you know, and you should remember that both my husband and I were first-generation founders, right. So we had an EMI, I had a three-year-old, and we were both running businesses. So there was no salary coming in today. When I look back, I was like, How foolish we have been. But from there to this, the first thing I wanted to just sit back, right, just put down my shoulders and you know, probably take a break. Then I realized, you know, I’m not built that way. So while I’m taking a break, you know, I want to start thinking about what I want to do next. But I thought it’s best to definitely take a six-month break, let’s travel and then think. And then in between, I met Samir and Samir, I spent time with both of them. And I really liked their philosophy. Because the first line they said, both of them said that look, we started Venture Highway for our passion. And I think that really resonated with me and I said, Okay, let’s do this, right, like, and they obviously reposing faith in me, given that I’m a founder, I don’t have a VC background. And if you notice, in India, at least a significant number of them. They’ve been at this job for a long time, right, especially when you’re recruiting somebody at a leadership team takes a hell of a faith for that to happen. So I said, Look, I really like to work with them. And, you know, they come from a global, you know, both of them x Googlers. And Neeraj, of course, is iconic with his WhatsApp exit. It’d be great to learn and work with them. And then I said, Okay, I kept joking with Samir and said, Look, work with me. And if you like my working style, at best, when I start something, please write your first check with me. And he kept saying, absolutely. And then, you know, I think I’ve been tricked to be here for two years, and I’m completely loving it. So, it was completely accidental, plus the fact that I didn’t have the next big idea at that point of time. And I also wanted to gain a skill which, till now, I’ve been always, you know, working in from very Indian companies, right, like having, you know, spending a lot of time in Madras. There’s only so much that you get from exposure in terms of working with global companies. And I think that also really attracted me and the fact that you know, you get paid to learn vicariously from meeting founders, right, that’s amazing. So very accidental, and probably, again, a big, big stroke of luck for me.

 

Siddhartha 14:52

And what are the companies where you have led investment at Venture Highway?

 

Priya 14:57

Um, quite a few but I’d like to highlight I mean edtech after a long time, took a bet on this company calls Swiflearn. I’m a mother of a 12-year-old today. And you know, she’s moved from an ICSC school to an IB now. But I’ve been very close to the Edtech scenario, not just as a founder, but also being a mother. And Swiflearn tries to solve for trying to be the best after school supplementary brand for online tuitions, right? And if you think about it, you know, today, if you want to send your kid to Kumon, right, why would you send your kid to Kumon? Because you’re not worried about the teachers, people who send their kids to Kumon. They like the framework. They like the pedagogy, there’s a certain ROI you’re getting. What happens today is tuitions are largely still fragmented, right? Most of the middle school, parents send their kids to tuition, which is nothing but the teachers themselves in the school. And the kids are huddled up in their houses, and they’re practicing the same thing that is taught in school, right. But there’s a huge learning gap there. And, you know, in Vidhyartha, I had this massive data, state by state to show how there’s a huge gap between aptitude and academics because kids are taught to score, right. But they’re not taught to learn. But scoring is equally important. So the idea of Swiftlearn is can we create a pedagogy driven framework driven brand, which can, you know, scale, the one is to few online tuitions, founders I’ve been have ran dormant before, which didn’t work out but really excited about his first principles thinking so that’s one company. There’s another edtech company, which we are, you know, we’re looking at. And then a few other companies I work closely with, which is, which includes w mall, which is in the social commerce space, again, very, very good founders. another company called BuildSupply, which is in Delhi, work with Samir Nair very closely. BuildSupply is in infra tech space. Basically, what they do is they provide SaaS for real estate and infra companies for their workflow management. And on top of that, they are building up procurement, commerce, very tech, lead tech, first kind of a solution for this space, which is not seen much technology before and Sam, amazing founder, again, you know, solid experience, have been in the real estate leadership positions for, you know, decades. So these are a flavor of some of the company’s very, very different very, very different styles of leadership teams, very different spaces. And it’s been a great learning experience working with some of these companies.

 

Siddhartha 18:00

And you are a board member in Marsplay. So, any other company where you hold a board position?

 

Priya 18:12

A lot of these companies, we have board positions, but we choose to take it at an appropriate time. So we don’t necessarily exercise the board position. Marsplay is again, is a community content. So mostly, the thesis is run by founder Misbah. He’s quite popular in Twitter, he’s very connected in the startup community and Misbah’s thesis in mars play was about, can we make content shoppable, right. And he focused on building this community of tier two, tier three young people, where the platform becomes very interesting for creators to again, you know, sort of allow their content to become shoppable. So that’s mostly Marsplay. They’re young, they’ve been around for about a year and a few months. Again, very different styles of leadership and very different space.

 

Siddhartha 19:14

Both you and Samir are in leadership positions and your title is startup sensei. what’s been decision making like at Venture Highway, and you are now connected to other VC firms? Also, how are you guys different?

 

Priya 19:56

That’s a great question. Actually, you will see that the entire leadership team comes from an operating background. Right. So Neeraj obviously has been very closely associated with WhatsApp and has been the CXO. And then, Samir, while he was at Google, of course, he’s done that corporate m&a and everything, but he came back and seven years, he was managing his family business. You know, literally, his joke would be, you know, lets go of Google’s free food to come in, you know, be in the factories at Faridabad. And, of course, I have not had that global exposure. I’ve been eternally, you know, throughout been working in India, and Indian companies, right and have the last seven years of my own. I think that’s the first thing all of us are operators. I think the decision making, I would say, is one of complete collaboration. Having said that, it’s also not what I like about Venture Highway is that each of us literally take conviction bets, and you know, even if the other person, and that’s what I feel you find these amazing companies, right, if there’s too much consensus, right. I don’t know if too much consensus. I mean, again, so that I’m talking about with two years experience at VC. So you may want to take my entire gyaan with a pinch of salt, but I feel some of these bets need to be on a conviction basis. And more often than not one person is more convinced than the other. Right. So, definitely not a parliament, which I love about Venture Highway. Literally, we are the fastest in decision making. We get together, you know, Samir Neeraj and I generally it’s over multiple calls, sometimes two, three calls and, you know, you know, the one person presents the deal. You know, the other two may have some devil’s advocate questions. But fundamentally, it’s a trust in the other person’s decision-making ability. And if we feel that one of us have that conviction, then you know, we should do the deal. And I have personally experienced that, because it’s amazing to have been able to take decisions in this industry. And I’ve heard these stories from others, right, how there’s a process and everything. And personally, I’ve had the best experience of having to be able to take such conviction bets, and having to be able to reflect on some of these decisions, because essentially, this game, I’ve realized is only the quality of decision making, you can’t control the outcome, right? There are so many variables, there are so many things, you know, and there are more often than not, you have so many companies where, you know, we always have this conversation, they have great metrics, why haven’t they been able to raise money, there’s so many different dynamics that it’s very hard to kind of model it out as best we can improve the quality of our decision making improve our frameworks. When we think of the founders and the spaces, I think for that, you should have the opportunity to learn from failures. And that comes only when you are able to completely Own your decision, execute on it, see the full cycle and actually face those failures to go back and revisit the quality of your decision and improve your framework. And I think that opportunity. I’ve got amazingly in Venture Highway as a platform.

 

Siddhartha 23:23

I think in venture capital, the two most important things, the quality of your deal flow. And the second, which you mentioned, you know, the quality of your decisionsand decision making is built over a period of time. Right? We all come with subjective biases, and we try to make them objective. As we keep on learning from our mistakes.

 

Priya 23:45

You’re absolutely right. I think the biggest bias, to be very frank with you is confirmation bias, right? Like, you know, the minute you think you like something about a deal, you’re searching and seeking for information, which is going to just agree upon that decision, which you perhaps have already made in your mind. Right. And then you know, kind of it keeps building on it. But it’s important to understand that, you know, what is interesting about this is you can at best create frameworks, but when you apply them, it’s applied on such heterogeneous data points, right, you will never find two founders who are the same, you will never find similar profiles, you’ll never find similar combinations, you’ll never find you know, a certain equation that happens which is the same founder profile plus the space plus something else, your ability to apply these frameworks in this completely heterogeneous data points is what I think is is building the scale here, right and to not be negatively biased as much as we talk about confirmation bias to also not be negatively biased because, you know, obviously for many of us, you know, there are spaces right as you know, EDTech was like a crazy, very not a great space before BYJU’s, right? The whole funding happened, right? I remember one investor when I was going to pitch who told me Oh, it’s a graveyard of failures. And you know how that has changed today. So it’s also important not to be negatively biased, based on perhaps some decisions we took on the sector or the space.

 

Siddhartha 25:24

Absolutely. And these things change over a period of time. Nobody used to care about Edtech before BYJU’s, and Unacademy and Toppr. Today, every investor is looking to have a deep Edtech portfolio. So, things change in this industry pretty much, you know, sometimes overnight, also, as in case of COVID and Demonetization?

 

Priya 25:47

Absolutely, absolutely.

 

Siddhartha 25:49

You come from a very different background. How has that helped you? What are the pros and cons? I would ask of having that.

 

Priya 26:01

Let me start with the cons. First, I think the first six months, you come with this optimism of a founder, right, like most founders have this irrational optimism. That’s what makes them founders. Yeah. And I remember coming to work and I have, I would have five to six meetings with founders five, need five to six founders literally every week, if not more. Yeah. And you know, the, I would love it, right? Oh, my God, so many different ideas. And the kind of optimism was like, looking at every deal. And thinking about how I would do this, right. And I learned very quickly, that’s a very wrong and stupid way of looking at things because and the best analogy I can give you for this is, if you think you’re a good jockey, great. But don’t think me being a good jockey is going to automatically make you great at horse picking. Right? Those are two different skills. And that’s something I learned very quickly. So I went through this journey of over optimism that I went through this entire cycle of cynicism, where I was trying to figure out what is the issue with every deal. And then you get this balance, right, you start building your own style of mental frameworks, your own, you know, kind of things that work for you write your own checks and balances. And then you start looking at founders and companies and in that eye, so I think the con is also the fact that, for me initially, to be able to understand and internalize the fact that VCs are a second-order, kind of stakeholder in the business, the guy who’s running the business is the founder, he’s holding the saddle, and he’s gonna sit on the saddle, and he’s gonna ride it. So to sink, although it’s theoretically understood to sink in took a while for me. But over a period of time, I think I’m learning how to make that approach where I get excited to work with founders on small areas where they think they can bounce off their thoughts. Or they can bounce off their ideas with me. And wear that hat as a founder, even though I’m sitting on their board in a complete non-judgmental way. Because I’ve been on the other side, and I understand the vulnerability. And the other thing, I think, and you know, of course, people claim this is gender specific, I think. I’m very happy to show people, my vulnerability. And I think being authentic, really helps improve the conversation. I’m very, very particular, for example, regardless of whether the founder is being funded or not, then he comes to our office. And when he sits across the table, he has taken this decision of going to spend the next 10 years of his life on this idea. So can I make that conversation important for him? Can I make that one hour fruitful for him? Right? And I try to think of him as my customer. And think of how I can give him the best one hour.

 

Siddhartha 29:17

That’s phenomenal. So, you have obviously made one of the cons into Pro.

 

Priya 29:25

I mean, having said that it’s a fine balance, Siddhartha. I think at the end of the day it is when you’re working with each founder the needs, the way you work with them changes contextually. And as I sit on the boards and see the journey of some of these guys, I think that that’s a very valuable amount of vicarious learning which can be channeled to your future founders as well. And I think that’s the experience that some Longtime VCs really have up their sleeves, which is just the experience and the wisdom of having seen companies grow, grow bigger fall. I think that’s amazing wisdom, right, and experience. And if you’re able to cleverly tactfully and contextually channel it back to your young founders, I think that’s a responsibility, I would say, for VC.

 

Siddhartha 30:26

And what would you would say, you know, the pros are being an outsider, an entrepreneur for a long time coming into VC.

 

Priya 30:33

I think, you should do another podcast and ask about this to Samir and Neeraj. But I think I almost always have a very different perspective. And it brings a very different flavor to the conversation. And I think that’s on account of two things. I think, one is obviously being having been a founder. The other thing also I think, women generally I feel, and I have a lot of friends who are in leadership positions, who are women, and they bring a genuinely different perspective. Right. I think that’s another Pro. And I think the other thing is, I’ve been very fortunate to work with very senior people in the industry and in a very short time to be given that your and being taken seriously, despite my lack of experience in it, right. And, to be able to sit across the boards with people who’ve been probably doing this for years, and founders who perhaps respect the advice or the pointers that I give them, I think, that’s been a phenomenal journey. Because when that happens faster, and I’ve heard that different experiences for different people, but at least personally, for me, I’ve been very fortunate in partnering with amazing people and venture gives you access that nobody else gets. And that’s a privilege, we should humbly you know, sort of embrace and, acknowledge, because venture gives you access, like nobody else gives and that access, if channeled in the right way can help you build, you know, your core set of people who can help you think, mentor you and you know, drive your intellectual thoughts even better. And that’s one of the biggest pros I found. And if you’re able to channel that back to your portfolio to your companies, that’s amazing. I think that’s something this industry has, which is a complete privilege. Because I’ll tell you honestly, today, I mean, as a first time founder, right, to be able to write a cold mail to somebody, Visa v today as a VC, even if I write a cold mail, right, my probability of getting a response is far higher. Right?

 

10x higher

 

And that’s a realization I got when I joined. And I’m like, Wow, that is huge. The access this place gives you is huge. And how do I responsibly give back with this access is what plays in my head all the time.

 

Siddhartha 33:16

As the Spiderman quote goes with huge power comes huge responsibility. Also, you know, every VC almost represents the entire VC industry. A poor experience with a VC shaves the mind of a founder.

 

Priya 33:32

Absolutely, absolutely. Every time I have a conversation with a founder, and when people come and tell me, you know, I’ve had this experience, I’ve had that experience. Like, you quoted Spiderman, I would quote oogway from my favorite Kung Fu Panda, right? Then when Shifu comes in, tells him I’ve got bad news, Oogway turns around and says there’s no news. I mean, there’s no good or bad news. There’s just news. So like that, if we take just apply the word feedback, right, and not worry about good or bad. And I’m not saying it from the high horse who is sitting as a VC. I did that personally as a founder, because trust me, I’ve had absolutely 100x more rejections. Trying to raise money for an Edtech company and the worst of the times for Edtech

 

Siddhartha 34:24

That really shapes your experience now as a VC, I would say, Now, you would think back that that’s been an advantage, because you face being a founder that now, you know, being a VC, you bring a very different experience, rather than a VC or a traditional VC or I would VC who has sold his company at the peak very successfully had all ducks lined up. Right. I can very much relate it to myself.

 

Priya 34:54

Yeah. Yeah, absolutely. And I think what I tell people is that look, instead of looking at it from an emotional angle, because at the end of the day, when we look at it and the shaping the experience, you’re channeling everything to a person, right? Instead of taking the person away and just take his points, and even if there is 10% feedback in there, which is worth for any of us to reflect, right, I think that’s worth reflecting on. It’s a good mindset to have, especially as a founder, because we have to be trained to hearing no all the time. And the sooner you create a mental framework to sort of tackle that, I think it’s better for you to build emotional resilience, which is much needed being a founder.

 

Siddhartha 35:44

No, no, you pointed out rightly, right, the more a founder is able to disassociate with No, from the person he is to what he’s building and just temporary feedback, the better he is able to take it objectively or, say less emotionally, because absolutely every no adds emotional burden, being a founder myself, you know, this is the same thing which I do you know, every NO is like a needle in your confidence, basically.

 

Priya 36:19

Absolutely, absolutely. And, you know, I have to tell you this, the biggest challenge being a founder is to be able to live without the typical validations that you get being employed, right? See, you’re reasonably smart, and probably have done something reasonable in your life, and you start this with great passion. And you know, for the first six, seven months, you’re exposing yourself to customers, who are going to be brutal, right, and you’re going to be getting feedback from there, then you’re exposing yourself to investors. And not every meeting is going to be amazing, where everybody is going to pat on your back and say, Wow, I’m gonna write a check right away. And to be able to come back home and still hold that confidence. Right, is something that I completely empathize and understand with founders, right? And I’ve gone through that as well, right? Like, yes, I’m a CA, I went to ISB, you know, I left a job doing this. And there are days when I would ask whether this is worth it. And not to get philosophical about it, the way I looked at it is, you know, at the end of it, okay, if there is a reason he’s not writing a check, what is it in my model? And I would try and separate it out into two parts? Is the feedback very specific to the industry, which I cannot control, then there’s nothing I can do? Or is the feedback very specific to my business model? And then if the feedback is specific to my business model, then I dive deep to see, okay, Is there even an iota of merit in what that person is saying? Have I missed clues? Or have I missed some data points within my customer feedback? To say that that’s something that I should look at? And if the answer is yes, absolutely. Go back and iterate. And that’s how we pivoted. Right. I think that’s a very important exercise, that learning agility for founders is very, very important. And it’s much easier to do it when you disassociate every conversation from the emotion and the person to the feedback,

 

Siddhartha 38:21

Yes. Priya, What you said and what we have discussed, I wish somebody had told me when I was a founder myself, this is applicable and valuable for all the founders out there. Because essentially, in a five to 10 year journey, if how you react to Nos that you have to optimize, right?

 

Priya 38:43

Absolutely. And I think, even from a character perspective, you look at my like LinkedIn, there’s a quote, which says, character over talent anytime, right? If you, you know, like you said, and you made a great point. It’s great, like, you ride out the wave, if you’re lucky enough to be on the top of the wave, you’re surfing High and High. But some point when the wave hits, and you have to get low, I think that’s when your character gets really judged. And it’s important to kind of build that upfront, and have some rubrics for it, it really helps. And one thing that has helped me personally is to I still continue to have some set of close friends. And regardless of where I am, or what I do, I still my closest friends are still my ex co founder or some founder friends who still tell me as it is, and you need good people will tell you as it is, right. And I think that also really helps.

 

Siddhartha 39:42

Thank you so much, Priya, for the candid conversation and sharing your experiences, very candidly, as being a founder and now two years into VC. You know, I think this conversation will help a lot of founders you know, build up their confidence when they’re feeling lower getting rejected from a VC. Because not them, It’s objective. And VCs also make mistakes.

 

Priya 40:11

Oh, absolutely. but see it’s also important for founders to understand the business model of a VC, right? Like they have a business model, the VCs have a business model. And at the end of the day, it’s human beings who are making the decisions, just like the founder has made a decision that he is going to go behind this space. And he believes that this space is going to be large. In a similar manner, a VC is making a decision, whether this founder and this space is going to be large enough. So actually, very often we miss that, right? The VCs are humans, there are people making judgment calls. And the very name judgment means it’s a probability exercise, it is not a definitive exercise, right? The entire VC spectrum, whether it’s the startup or the VCs, it’s a probability game. And obviously, then a thing has fallen in the other side of the probability. It’s a loss, right? And that’s the game we are playing. And we have to just internalize that so even founders, they should understand. Take all data points. But don’t give 1,000% weightage to any data point. Right. Ray Dalio says this beautifully, I would recommend people to read this book called principles. He says, when you’re evaluating data points, please assign weightage to each data point and assign a believability index, according to him, also assign a weight depending on who that advice is coming from. And look at the background and the experience of the person. Now, obviously, the person is negatively biased, he will have a certain data point, he’s positively biased, he’ll have a certain data point. That’s why I said take the feedback, try and, you know, extract the feedback, which is very relevant to you. And I think that will make a huge impact. But you’re right, I think VCs make mistakes. And I think the only answer to it is because it’s a probability game, right?

 

Siddhartha 42:16

And as you’re speaking, you know, the regret is much higher on the side of the VCs because Gaurav Munjal from Unacademy pitched to 50 investors while they were raising their seed to series A, and only two or three of them said yes, the rest 47 are feeling so bad about that decision because they either couldn’t understand the space the time or the vision of the founder back then. Similarly, for BYJU’s, there are only few people which are few VCs said yes to BYJU’s back from 2011 to 2014-15. You know, and we can imagine, you know, the rest of 50 to 100 VCs who said No what they must be feeling.

 

Priya 42:55

Yeah.

 

Siddhartha 42:56

So, as you said, you know, founders should take VCs feedback very, very objectively and not assign too much weight on it in the course of their journey.

 

Priya 43:07

Yes, I think, you know, I’d like to make a point about this regret. Yeah, every big decacorn and unicorn today is regret for the VCs who are not in it. Right. And if you’ve seen some of the best journeys, this comes back to the original point, which I made in answer to your question as to how’s the decision making at Venture Highway, you’ve seen every one of these complete breakout companies have been based on conviction calls? I personally believe if things were so easy to see, right, then how do you get that big time outcome? Right? It has to be an insight. And I bet, you know, when Sequoia perhaps invested in BYJU’s, and then I’ve met BYJU’s obviously, multiple times, even before he invested in us. He’s a special founder. Right? The way he talks about his story, the way he presents his vision, the passion and the energy he brings. It’s but obvious that somebody will relate to him. Of course, at that point of time, I think a lot of people would have said no, because of the whole Edtech debacle that happened and you know, people were obviously worried about the space and the segment. So ultimately, it takes two people to connect. If you think about it, right? You make a meeting and I feel that with some founders, right, there is a connection, there is an insight you connect on. There is a founder you connect on, right? And you look at this guy and you say, okay, Forget about five other things you think is going to build a large outcome. I think I have not met Gaurav Munjal but what I hear about him from multiple people, is that he comes across as that special founder. I think ultimately, very, very early-stage investments are all about the founder. Right? And it’s about like I said to people when they’re meeting, there’s a connect either at a personal level at an insight level, and then your belief that this guy is going to go and build or this girl is going to go and build something big.

 

Siddhartha 45:09

I agree with you, Priya, completely, you know, there are not many data points. That’s why it brings all the risk in venture investing because you have to be backing a founder without any data.

 

Priya 45:24

Absolutely. It’s at that stage, right, especially the stage that Venture Highway comes from, we literally over dial on the founder and the founding team, right. And we have some frameworks in our head as to how you know about the whole founding team, how to think about it. And essentially, we are very comfortable with pivots, I’ve pivoted, so I personally will not believe you know, anybody will come can reasonably come and tell you, I mean, perhaps a very, very small percentage that they’ve got the business model, right. And from day go, right, we are iterating all the time, see, at the end of the day, you need a guy who has that emotional strength and the learning agility to be able to navigate the markets, and to be able to deliver, and you have to trust him to pivot, right. And that’s happened with a couple of our other portfolio companies. So ultimately, we strongly believe that we need to over dial on the founder and the founding team, of course, the space is important. If you don’t relate to space or we don’t understand the space, then, you know, it becomes hard to take a bet. But I think the weightage of the founding team and the founder is at a very, very early stage is far far higher than I would say even the business.

 

Siddhartha 46:44

Completely agree with you Priya. And thank you so much for sharing your insights. Today on 100x Entrepreneur podcast. It was lovely to have you.

 

Priya 46:53

Thank you so much for having me. Really enjoyed having this conversation is very, not very often that you know, you can have a free-flowing casual, you know, personal comm professional conversation. I really thank you for this opportunity.

 

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