During her early career, Ritu worked in Product Development at Unilever and later in Marketing Strategy at Philips. In 2013 she Co-founded Ankur Capital with Rema Subramanian.

Ankur Capital has so far majorly invested in Agritech & Healthcare sector, some of its portfolio companies – Health Sutra, Cropin & Niramai among others.

In this podcast, Ritu shares her experience of investing in Agritech & Healthcare space in India, and her vision going forward.

Notes –

00:42 – Her Journey from a Physicist to the VC ecosystem

06:50 – Thesis behind investing in Cropin & Niramai

10:21 – Concentration of Portfolio towards Agritech & Health-tech

11:20 – Future of Agritech in India by emerging startups

21:36 – Training farmers for adopting Agritech solutions

23:20 – Deployment of Fund II in 2020 & 2021 (at Pre-Series A & Series A rounds)

25:07 – Recent successful exit from Carmel Organics and others in the pipeline (next 6-8 months)

27:40 – Is it difficult for women to mark a place as VC?

35:07 – Thesis behind investing in Jiny

 

Read the full transcript here:

Siddhartha 0:29

Today I have with me Ritu Verma, co-founder of Ankur Capital. Ritu, welcome to the podcast.

 

Ritu 0:37

Thank you, Siddhartha, delighted to be here.

 

Siddhartha 0:39

Ritu, we would love to know about your journey from a physics student to the time you spent with Unilever and Philips and also your learnings, how your corporate experience added value when you decided to start a VC journey.

 

Ritu 0:53

Sure. I think. For me personally being in the business industry is like being a physicist. So it’s not that different in many ways. But yes, I did start out life as a physicist. And I think that comes from what sort of finds my journey here is that I probably always been interested in, how do you get innovations out for people to use? And what probably attracted me to be a physicist was that, and then I kind of moved in that journey through different parts, but starting out at Unilever, about how do you actually, develop innovative products and how do you bring them out to the market. So starting on developing innovative products, but moving to bring them to market from a commercial perspective, and I think that’s the theme that has been there continuously and continues to be in what I do as a VC today. It’s interesting that you bring up the learnings, and large organizations have multi different roles. I was always, in all of the organizations. I was more than the innovation department, where you would, you know, you were looking at bringing out new products or new services into the market. So, from learnings from there, it’s fairly similar, because you’re trying to bring out something different in the market. So you have had to navigate product-market fits, learnings from the market, failures along the way, because what you thought was a great idea cannot actually be produced or the market says, Hey, I don’t like this. So, just sort of empathy of a startup entrepreneur of how you go through that is also something that you do as an intrapreneur in a larger organization. The only other difference here I would say is that because you’re embedded in a larger organization, you also see the journey much further out, because you’re working alongside other people who are obviously working on much, much more mature things, and happens, you see what, three, four years down the line, what a new product would have to go through? And how would you run a business in a much larger scenario? So I think those are the two things that the corporate world and my experiences in the corporate world translate into the VC world, the early days of the hassle of how you actually get a product-market fit and actually listen to the market and make something happen. But along with that, what comes in that journey down the line,

 

Siddhartha Ahluwalia 3:54

Why did you, in 2013, decide to become a VC rather than an entrepreneur, the ecosystem was really early back then?

 

Ritu 4:01

It was true. So I think that’s partially because I didn’t have the burning idea Siddhartha, right. So I think in order to be an entrepreneur, you have to have that one burning idea that you’re super passionate about. And through my career seen how tough a journey it is, despite all the support systems that you get in a large corporate, right, but in the parallel, they were people with ideas, right. And you could make an impact, there were gaps in the ecosystem, there were opportunities to be captured. And that’s probably what led me to be a VC. And, there is no looking back, right? So sometimes I think about if you’re an entrepreneur, you get to see that one innovation and you get to see that through and there are huge rewards of sort of doing that. As a VC, you sit at the ringside of many innovations, Game Changing innovations and how they’re growing and scaling. So I think I have no regrets about that.But probably mostly in 2013 was driven by the fact that I saw opportunities and saw innovations. But I personally did not have that one burning idea.

 

Siddhartha 5:21

And how did you find your co-founder Reema?

 

Ritu 5:24

So we were both working with early-stage companies sort of more in advisory capacities.

 

Siddhartha 5:31

While you were working with Philips?

 

Ritu 5:33

No, not while at Phillips. I was here in India, we were working with a sort of an accelerator incubator that was looking at early-stage organizations, I should say because there’s a different range of organizations that are there. And that’s when we started spending time together and talking and, you know, started working with a few companies getting our hands dirty, sort of used our personal capital to actually become kind of angels in there. And that led to the setup of Ankur.

 

Siddhartha Ahluwalia 6:05

and what are some of your angel investments if you can share?

 

Ritu 6:07

So, we made an investment, which is not in our fund and also an investment that we’ve exited into the waste management company. Some of what is in our portfolio started out as Angel warehoused Angel deals that then moved into the fund portfolio here. So the early first two, three investments in Ankur were actually warehoused that transferred into the fund.

 

Siddhartha Ahluwalia 6:33

In your fund when you started, can you share how you discovered your first few investments like CropIn and Niramai which have been very successful currently?

 

Ritu 6:45

So I would say it was an evolving thesis, but again, I’m going to go back and this is true probably for both Rema and I. When I worked for HUL, you got to see upfront The larger market, which I will call the mass market, or what today is called the next billion, you know, sort of looking beyond the urban centers and the middle class and upper-middle class, but looking at the half a billion plus folks that are there, and what you typically see that it is a very vibrant market. And in 2013-2014 year old technology was just starting to make the forays into these markets. So I think that was sort of the opportunity that we were excited about, Rama through her working in many other avatars before had also seen this at a front end level. So seeing how you could kind of actually now get the technology to sort of integrating with what had always been opportunities, but lots of difficulties in sort of serving these markets or creating the products. And that’s kind of what led us to some of the investments that we made. So if you take a look at cropIn, it falls into sort of the ad tech what is called an Agritech space today, that word did not exist when we invested in this company. But what you would see is that there were many reasons as to why phones, cell phones, and less so smartphones at that time, but that came along, you know, we’re making forays into where agriculture was done. And hence, people were using them for multi-purposes. CropIn was somewhere in its early days riding on that whole piece. For CropIn, we went out into the field, talk to a lot of people, farmers, etc. And there was just a sentiment that said, Look, you know, perhaps this is something that would get adopted and sure enough, it did. Not only in India but way beyond India and Niramai is a fairly similar thing, right, and a very disruptive technology. Breast cancer screening has its traditional methods of how it is done. But obviously, in contexts like India, it’s super hard to execute, not just because of the cost of machinery, but even from a skill perspective, we don’t have those skills. So you have to think differently about how you’re going to do things in a country like India, and you have the entrepreneurs who have this digital penetration. And Gita was not just somebody who was kind of at the edge of doing this and it is a technology which technically is like a, you know, once you build the software and AI out costs very little, doesn’t really need super experienced radiologists to be looking at any of this thing and so can be used to unlock a market which yesterday was not possible. So I think these are, you know, this somewhat the fun thesis it’s like entrepreneurs that you meet that are kind of solving for some of these larger markets that led us to these investments.

 

Siddhartha Ahluwalia 10:15

And why is that you know, your portfolio is concentrated towards Agritech and health.

 

Ritu 10:21

So, we are sector agnostic Siddharth, not market agnostic necessarily. We are looking for solutions that can actually unlock these larger markets. And I like to say is that as a VC, you’re a forward-looking business here. So here’s where the entrepreneurs came. And they fit into the opportunity set that we wanted to be exploring. And they just so happened that they were in agriculture and health and that’s what happened over the last five years. You know, we’re still bullish about for the next five years. But I think there are other things that will come in as well. And then once you build the momentum around something, you know, there are more things that you see so probably leads to a larger exposure in a particular sector as you get more confident.

 

Siddhartha Ahluwalia 11:19

Can you dive deep into Agritech market, the size of the market, which you believe is impacted by technology? And what role can startups like CroppIn play? how big they can get this if you’re talking about 2025 because that would also be the time when you would be looking to return money to LPs, what kind of exit do you feel these companies can have?

 

Ritu 11:47

Agri is a very, very large market. I mean, we all eat and that’s not going anywhere. However, it is a legacy sector which has not been touched by technology. Right? So I mean, if you take consumer or anything wrong in this market globally and subtly huge at the end of the day. So I think the opportunity lies in the fact that it’s a legacy industry that technology has in touch. What are the touchpoints where technology can actually revolutionize this industry? And then I think there are billion-dollar companies to be built out of that, right. I mean, most tech companies are super large, right? I mean, we’re talking about hundreds of billions of dollars. This is kind of what they are globally. So I think, as an opportunity set, it’s very, very large. However, not all parts of it are amenable to building a billion-dollar company. Agri also has some other challenges around it, which is about you know, Food Security and protectionism and political stuff around it. And those are really actually not commercially touchable in many different ways. Yeah. But what we definitely see is that there are probably about four areas that have, really, really large chunks. One is in inputs and Agri inputs and how that kind of goes in. It’s again, a 50,000 crore- 70,000 crore kind of industry. And again, it’s fraught with a lot of issues and how those supply chains actually work. And the same on the output side, right? How does that output get from farm to you and me is again, fraught with a lot of issues of inefficiency is lack of information, information asymmetries that lead to pockets of price gouging and that sort of stuff, all of which technology is very, very capable of solving. Along with these, as you look at digitization, the digitalization of these two different parts of agriculture comes information. So that is large play information and what information can kind of unlock for different types of actors, whether they’re financials, whether they are processes, whether they are governments, so that’s the third area that kind of spills over, out of this. And on backing on top of all of that is what I would call Ag FinTech. Once you have the information flows kind of available, which today is actually it’s in digital darkness or very, very early days of digitization. So as soon as you get rid of that, on top of that, there is a very, very large opportunity for financing and by finance, I don’t just mean loans to farmers. It’s creating products, it’s creating insurance schemes. So it’s creating a whole bunch of things to build an ag finance industry, which today is super, super weak, especially the Indian context as to how that happens. And last, but not the least, agriculture is a global play. And I always think that India and this has been played out in other industries is that is a really great sandbox, where, you know, we’re really good tech talent that has not much money, developed world-class products and data are applicable for a large part of the flow. So you will see the globalization of Indian tech in ag as well. So all of these are worth of billion-dollar opportunities, and I think that completely investable and, to offer a lot of opportunities. You can have various combinations of these that are just one segment.

 

Siddhartha Ahluwalia 16:02

Till now, all of India, the only billion-dollar companies in health or I would say the entire health ecosystem have been the pharma companies, not even hospitals. Why do you believe the tech companies especially where you know you’re an investor can be billion-dollar plays considering the same time frame 2025?

 

Ritu 16:25

That’s just the global trend here, Siddharth. Right? So I think the last few decades right in health. So I want to divide health up into a couple of parts here, right one is sort of on health delivery, right. And one is on health and health linked products. Right. So I think what you see happening globally, is the health linked products and some aspects of delivery, moving to a digital world here or embracing software in a much much more robust way whether it is from drug discovery, whether it is from actually AI-led diagnostics, whether it is from personal health monitoring, optimizing hospital flows, all of that kind of stuff. So, I think, again, that’s the reason that you’ll see some of this happening is not because we are here, all of a sudden now discovering the drugs in the world, which I think we will, but also because we’re looking at the intersection of software technologies and health, which, if are developed well, have global implications on how that works. Now, I have one caveat, when you come back to health services, deliveries, most places have their own quirks, like different countries have different quirks and sort of how that kind of happens. So, companies that are going to go on to become billion-dollar companies will have to navigate some of those quirks and just a pure India solution may not work as well in another country. So your technology, your product has to kind of take into the account quirkiness of healthcare systems globally. And, Niramai because it’s not about the hardware, it’s not about the physical product. It’s what an Indian tech company can do with the software to unlock a completely different way of how you would go around diagnostics.

 

Siddhartha 18:38

How has your journey been as an investor seen distribution in both of these companies in the respective spaces? One in the tech and the other in health because they are not necessarily a digital distribution. There is a lot of on the ground element.

 

Ritu 18:57

Yeah. The figital part you mean?

 

Siddhartha 19:01

Yeah.

 

Ritu 19:02

Yeah. And that’s a journey like any other thing. So yes, this is not same as having just pure tech digitally distributed goes viral. I mean, this is not a Twitter, this is not a Facebook, this is not that kind of technology. There is an intersection of these technologies with the physical world, which obviously slows things down a bit versus something going viral a year or two. But on the other hand, these are moats, right? So as you get those right dislodging you, is super difficult. So, they’re much closer to less B to C ish. They’re vastly more B2B ish. But once you’ve kind of solved for the customer and you’ve kind of done stuff the customers happy with you know, you don’t leave that easily, either. So I It’s a slower journey, definitely. But it’s a more lucrative journey. It’s a more efficient journey in many ways, as opposed to just customer acquisition at very high costs. But they stay. So we’ve been invested in CropIn, this is now about over five years at this point in time and we’ve seen that journey. The first customers are still customers, as a matter of fact, not at the same size, but at much larger sizes. So that’s something you get.

 

Siddhartha 20:34

There must be a large feet-on-street for both of these companies?

 

Ritu 20:37

No, So it’s not feet-on-street because you’re a B2B. The Bs have feets on streets. It’s more about sales cycle and adoption because you’re bringing in innovation into an area that didn’t have innovation, right? You don’t have to be building your feet on street, the feet on street your customer has, you have to be upgrading that feet on street, right. Let’s take CropIn for example, Agri workers need to be able to use this technology easily. Right? So you’d have to have the right the product UI, you’d have to have the training, that type of stuff. But you yourself don’t have to build a feet-on-street. You’re still a tech company in that. It’s just you have to educate other people to use your technology.

 

Siddhartha 21:27

And how does that education happen without your salespeople or your account managers going one on one?

 

Ritu 21:35

It’s a good question, Siddhartha. You see happening the early days where, you know, I’m going to sit and tell you and walk you through my deck. But more and more you see this shifting online. So there are a lot more online-based training tools. So I mean, take 2013, the smartphone adoption was super low to start with. I think it was the rich elite that probably had smartphones. It was not prevalent like every agent had. But it is now. And people are much, much more comfortable with it. So it’s not like you’re getting them a rocket here and saying, Hey, now I have to sit with you to explain it. It’s more like, Okay, I’m accustomed to it. And, I open this app, it walks me through a training module, you know, I can do Q&A. Maybe I have some video classes. So, there are a lot of those things that just the customer is much more amenable to today. So you see the physical level of it coming down, and I’m super optimistic that it will keep coming down. We’re invested in another company called Jiny. And Jiny is a super exciting company for us because it plays a horizontal across all sectors, and saying, how do you take people who are uncomfortable and interacting with the phone, in any language, and put in the tools to bring down the cognitive load here. So if I’m a field force worker, and I’m just having trouble, I’m not too comfortable. I mean, I can watch YouTube videos. But navigating further on the phone is not my comfort zone. This is an overlay that helps me do that. And we ultimately see that helping any company. But in this way, bring down the physicality and making things much more digital because it’s like a person sitting there talking and pointing at things or watching through stuff.

 

Siddhartha 23:33

Got it. So, Ankur Capital’s recent Fund is of 350 Crore. Tell us more about the deployment plan of the fund and what’s your average ticket size going to be?

 

Ritu 23:44

So, the deployment strategy remains very similar to what we had earlier except we have got larger check sizes and we can go deeper. So we’ve been counting whoa on watch digital and can drive in the next billion markets mass markets in India and that’s the same thesis that underwrites. They are sector agnostic. They’ve done a lot of Ag tech, we will leverage that, we’ve done health we’ve leveraged that but we are open to looking at FinTech, AdTech you know, vernacular technologies, a whole range of stuff. addressing what I would call them this large market segment. We used to do about million-dollar checks we can now go up to $5 million. We still start early and look to support a company through its pre-series A to Series A journey here. That’s the opportunity that Ankur was built on. Ankur remains seed sapling. And when we started Ankur, it was the gap in the ecosystem of early-stage funding, when there were lots of series A funders that Ankur came in to sort of address. We continue to play in that. Check sizes have gone up, we’ve learnt along the way that takes more money.

 

Siddhartha 24:58

and how many companies you’re going to fund out of the 350 Crore fund?

 

Ritu 25:04

Somewhere around 16 to 18

 

Siddhartha 25:06

You’ve also given a successful exit. Can you tell us more about the size of the exit? And how are you planning the other exits in the portfolio in the upcoming next five years?

 

Ritu 25:16

Yeah. It was a global supply chain that we’re working in. And it was actually, in many ways, sort of how we had planned the exit in that company that it played out. It was more of a company buyback. The other exits that will come through other funders in the ecosystem or strategic players, and we’re in conversations with especially some of our earlier investments to be exiting them out for the next six to eight months.

 

Siddhartha 26:00

Great. And can you tell us about your journey with Carmel organics a little more?

 

Ritu 26:07

Yeah, so Carmel is the company that we have exited. And Carmel, as I said, played in the high-value medicine, herbs market, where they were, they were a globally supplying these things. So it was much more of a physical company. And from our previous fund, we would do what we call the structured, investments that were linked to cash buybacks. So it’s like a mess structure, but at a very early stage. And so this is one of those things and they use the money to grow their customers and they increase their sales and gave us an exit through that.

 

Siddhartha 26:54

Coming to one of the stories where one of the potential investors wrote a check for 11,000 rupees. Is it true?

 

Ritu 27:04

Yes, it is true. We reached out to somebody to do a fundraising. And the next thing we know, we got a check for 11,000, which we didn’t know what to do with and returned it back.

 

Siddhartha 27:18

What was your reply to that investor?

 

Ritu 27:20

Thank you, but we can’t take it. I mean, we’re a SEBI registered fund that has minimum investment sizes. So doesn’t matter how desperate we were raising, we can’t really be taking 11,000 rupees.

 

Siddhartha 27:35

So, do you think, it is harder for women to build, in your case of VC fund and require validation from the external world?

 

Ritu 27:45

Siddhartha, that’s a difficult question, because I have a case study of one. And I think we’ve never sort of given it a thought that you know, I mean, of course, we know we have women, but we haven’t really sort of given that a thought. I mean, the trouble is that each one of us walks have a personal journey through this. Like it’s a single point of your fundraising experience. And it’s pretty unique in many ways. So it’s tribution of what works and what doesn’t work is much harder. So to say whether things were harder or easier as a woman, it’s hard for us to do, right because we never quite even thought about it that basic look when looking at building a world-class institution here that can continue funding and creating the innovations in the billion-dollar companies from the Indian context. And to somehow sort of that, you will a woman in this whole piece didn’t really cross our horizons. I’m sure there are people who are uncomfortable with it, right? Probably not happy to tell us And I’m sure there were people that are perfectly comfortable with it. So, but it’s a difficult question for an individual to answer because it’s a unique journey,

 

Siddhartha 29:12

Ankur is one of the very few VC funds in the world globally to be run by women. You have got so much positive communication from the ecosystem about yours and Reema’s journey. How does it feel on this side, given this space is still considered, you know, 90% male dominant in terms of the partners in any fund?

 

Ritu 29:37

Again, I don’t think we look at it that way. I mean, you’re absolutely right. There are very few women, and especially fewer women on the partner level piece here. Having said that, I think in India there have been other women who have been fund managers obviously, the ratio is still messed up right now. There’s no doubt about all of that. I think, globally there are a lot more issues, I feel that there are fewer, even fewer fund managers, etc, that are women out there. I think it’s important to have diversity, right, especially as a VC. I think there isn’t one thought that works just because you’re looking at a range of different investments. There are different kinds of challenges that come up, as in your investi companies, right. So to me, you know, one of the strengths that you build in an organization and whether it’s a ratio of women or men or different thinkers that you sort of do, it’s important that you bring in perspectives, perspectives that give you the best chance to succeed. So I think that’s critical for me personally, and for us at Ankur. And so being women, I wouldn’t say that that’s the only piece You’re right, I think, how do you build up a breadth and diversity at a fund, which is critical for delivering success. And you could be an all-female fund or you could be an all-male fund, and you could still manage that. But somewhere I think having gender balances helps in bringing in perspectives which are different.

 

Siddhartha 31:24

Coming to a personal side of Ritu, what’s your daily routine is Like? What habits do you attribute to your success?

 

Ritu 31:30

Well, okay, my daily routines are usually a mess. But I think the one thing that helps when you have early-stage companies, things are going up and down every day. So it’s kind of like a roller coaster that you’re on. And as an entrepreneur, a roller coaster of your own company. As an investor, you’re on the roller coaster of all your investees, right? So I think that’s sort of what our day to day life looks like in many different ways. The thing that to me helps is that all of these are learnings that I don’t take time out to read about different things here. So again, coming back to the fact that, you need perspectives, you need to be kind of contextualizing things that are happening, thinking for yourself as to how things would pan out, what happens next. And that just, personally, for me comes from actually learning and reading a lot, and then making connections, talking to people with different perspectives as well. So I think I try to do that every day. And as a next step, look to bring that in, when we’re looking at portfolios and looking at how portfolios strategies of growth and what comes next. And how do you think the next year will pan out? How do you think the next five years will pan out. So those are kind of things, I think that helps. And I enjoy doing that. So that’s what comes into my day for at least some portion of my day.

 

Siddhartha 33:10

What do you think are your strengths and weaknesses as an investor or board member?

 

Ritu 33:15

I think a board member strength and I think this applies to us and me as well. Right? One of the strengths is the fact that you’re not in the weeds, right? You’re stepping back, and you’re taking a look at the situation. So you can have a much more, higher-level view, a more if I may say, even-handed view of the situation. Whereas if you’re in the operations, it takes a lot more to extract yourself out of it. So I think that’s one aspect of the board. The other aspect of the board is the fact is that I think we’ve done a great job of sort of building networks out here, and actually being able to pull in people to sort of help at the board level, when there are specific things that are kind of needed, that are much more technical in nature, perhaps, if you sort of take a look at it. I think that’s a weakness. I would say. One thing that happens is be across sectors here. So, perhaps in all sectors, as our network strengths aren’t as strong to bring that in. And I think that’s an area of focus for us to sort of actually expand and I think the VCs job in many ways, is how can I bring the resources the company needs and, you know, support them, if you are supporting them and not just purely financial, which we are at Ankur? How do I get to resources as soon as possible and that I think we can be much better and I could be much better add other areas, as opposed to the few that we have developed.

 

Siddhartha 35:04

Out of the 13 active portfolio companies at Ankur, one company is very different from the rest is Jiny. So I would like to ask, how did you convince your internal team and LPs? Was it uncomfortable going on the Jiny route?

 

Ritu 35:22

Not at all, Siddhartha. So as I said earlier, Jiny actually was our last investment. And by that time, we were sitting at enough companies and you asked me this question about this whole training and digital that I was alluding to earlier, right? And what are sort of the challenges? So we’re investing in this market, right, which is not digitally native, right? People are coming online, digitally, here for the first time. Obviously, watching a movie or pressing a button. It’s as simple as it’s passing. So it’s how do you take out the past passive and how to move that user to be much active? And as I said earlier, we’ve also seen this in a B2B scenario where there are training tools, etc, that you need, let alone a B2C scenario. And when we have B2C companies, we have farm, agri ecommerce companies, etc, where people are interacting online to purchase their inputs. So, we had firsthand seen, you know, like, where things where the bottlenecks are here, right? And it comes down to very simple thing is that I’m just not comfortable navigating it. Secondly, the UI is built with a very English speaking person in mind, right? I mean, so far, we’re using all of that some obviously translate that’s no doubt about it. So Jiny was a horizontal solution to a lot of the challenges that we’d already seen. So we had pretty, no doubt that the applicability of something like this was actually very large across this. So I don’t think we actually have many challenges. it’s different because it’s not sectorial to some extent, and it’s like, you know, pure tech as to what it is. But it wasn’t needed in a market that we had firsthand seen and experienced. So to the How do you get India to be digitally active and take out the friction, and that was the thesis behind Jiny.

 

Siddhartha Ahluwalia 37:28

Thank you so much, Ritu. It was wonderful to have you on the podcast.

 

Ritu 37:32

Thank you. So keep up the good work.

 

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