Prime Venture Partners is an early-stage VC fund led by Sanjay Swamy, Shripati Acharya & Amit Somani. Prime is often the first institutional investor in category-creating tech-startups.
Prime was started in 2012 with the objective of bringing Silicon Valley style professionalism to venture investing and building world class companies out of India. It was originally called AngelPrime and renamed to Prime Venture Partners in 2015.
Prime is led by partners with deep experience both as entrepreneurs and operators. We work closely with entrepreneurs to understand the context of their business - be it in hiring, business strategy, sales, marketing, business model or fundraising. We believe the success of companies hinges on making large number of correct choices in the first 12 to 18 months of the company.
We are a low volume, high conviction, high support investor. We believe in backing star teams with differentiated ideas. We go inch wide and mile deep both before and post our investments. As Warren Buffet has said, diversification is a protection against ignorance. We typically invest in 4-5 companies per year. All partners work with all entrepreneurs for the first 12-18 months of the journey. We have invested in over 25 companies life to date and 23 of them are alive and well (ZipDial exited to Twitter in 2015).
We are looking for people a deep passion for the problem they are trying to solve and deep understanding of the domain they operate in. Entrepreneurship is a long and hard journey and hence having missionary founders is critical since there are likely to be more down days than up days. Some of the companies emerge from the entrepreneurs having themselves faced the problem though it’s not always the case. In all cases, entrepreneurs have a unique, differentiated insight into the problem they are trying to solve.
As one of the legendary founders of one of the best VC firms in the world has said, if its an A market and a B team, the market wins; if its a B market and an A team, the market wins. The market is really the addressable size of the opportunity you are addressing. We do not believe in a top down market sizing - every one of those can be in the 10s of Billions of dollars if not more. We prefer bottom up sizing for the problem you are solving. Often, in early stage, if you are building a category creating company there may be no directly quantifiable market size. In this case, it is still best to use a bottoms up approach for the “proxies” that represent the market. We, at Prime, do believe markets will evolve and grow and are comfortable taking market risks.
We are looking for solutions to real world problems whose solutions are 10X (1000%) better than the current state of the art. We are not looking for incrementality in the solutions. This 10X differentiator could be in the form of product, go-to-market, business model or even some unique industry insight. However, it is not a “me too” approach, even to a large problem. Since the firm was launched in 2012, we have not invested in “copycats”. The beauty of starting with a 10X differentiator is that this differentiation often leads to strong moats and defensibility as the company matures.
Often at an early stage, founders are focussed only on the product and that is fairly so. However, as a venture investor, we like to get a clear understanding of the proposed business model - aka your unit economics and your addressable revenue opportunity. We are okay to invest in pre-revenue startups or ones that have modest revenue. However, we are often not comfortable taking business model risk.
1-10-25 refers to how long and how much invested capital will it take for the company to get to $1M, $10M and $25M of revenue. The $1M of revenue often tells us about the operating plan for the next 12-18 months; the $25M number helps us assess the size of the addressable market. We are NOT looking for, nor would believe in a $25M+ revenue plan on a spreadsheet! We are just using this as a proxy to understand the opportunity.
- Deep 10X insight on Customer Problem, Technology Insight or a Differentiated Business Model
- Strong understanding of Market
- Complementary, Collaborative team
- Strong Learning Quotient, Bias for Action and Big Vision
The best way is to approach us through someone we know in common. These people could be founders of our portfolio companies, or others we know in common in the industry such as angels, other founders or even other investors. The least effective way is to send a cold, cookie-cutter email. We are also often seeking out founders through outbound efforts. So we encourage founders to talk about the problems they are solving, why they are solving them and how the world will become a better place as a result of it!
Our preference is to be the first institutional cheque in the company.
Our sweet spot is to back companies that have established some initial product market fit, and ideally, an “initial” business model. Having said that, in many cases, we have backed companies even before they've written a single line of code or had a single dollar of revenue.
We love meeting entrepreneurs at ALL stages - ideation to mature startups. Our goal is that every entrepreneur that meets with us benefits from that interaction; we certainly benefit from meeting all the wonderful entrepreneurs out there. If we do meet, our philosophy is to share direct and candid feedback with you. Whether we partner or not in your journey, we would like nothing more than to see all entrepreneurs be successful in their ventures and are here to help!
We were fortunate to invest in MyGate when it was in 30 apartments and Niyo, SmartOwner, Happay and many other companies started out from our office. But all of our companies have one thing in common — we met the founders when they were early in their journey.
No. We don’t think VCs predict the future — founders do. Most of the founders we meet and invest in, teach us what’s next. As a VC, we do have a broader view of the market and can sometimes see the forest for the trees.
Yes, our investments tend to cluster around Fintech, Enterprise, SaaS and Consumer Internet though we are sector agnostic. That’s not where our curiosity ends. If you’re building something unique and differentiated, we want to hear from you and learn about the vision of the future you have in mind. We have invested in EdTech, Healthcare, Logistics, IoT and many more sectors beyond FinTech and SaaS.
We have a small investment team of 5 people: 3 full-time partners, Shripati, Sanjay and Amit in Bangalore; 1 Partner Emeritus, Raj Mashruwala in Palo Alto and Gaurav Ranjan, who is also on the investment team in Bangalore. Typically, the founders meet with each partner individually, with the lead partner spending more time, eventually followed by a 4-person Investment Committee (IC) as appropriate. Depending on the areas, it can take anywhere from 3-6 weeks to make a decision. We like to go deep. We will talk to you, play with the product, talk to and meet with the customers, talk to folks in the Industry, etc. That said, we assure you that we are entrepreneurs ourselves so we will be very respectful of your time. Irrespective of whether both you or we chose to work with each other, you will hopefully find the decision making process to be thoughtful and valuable.
We are early stage investors and prefer to be the first institutional cheque in the company. Typically, we allocate about US $4M per company in the life of the fund and the first cheque is around US $1M-$1.5M and the remaining amount is allocated as reserve capital for subsequent rounds of financing. Of course, we want to have the companies we invest in to be well capitalised for hitting the right business milestones 18 months hence. So, the entry ticket size might and does vary basis the nature of the business and its capital requirements.
We are long term investors. When we come into a company, we have high conviction that the founders will build a large independent company and we would ideally want to hold till an IPO or a sizeable M&A event. That said, we do have limited partners (our investors) and fund boundaries so our typical holding time will be 7-10 years. We have rarely if at all done a secondary sale in any of our 25 investments.
If you believe you are building the next big thing! Let’s make it happen.