SaaS founders ought to take into consideration GTM from day one, says Nikhil Kapur of STRIVE Ventures

Nikhil Kapur, Companion at STRIVE Ventures, labored as a Software program Improvement Engineer and constructed Microsoft Excel for Workplace Cellular throughout all cell platforms early in his profession. Later, he went on to work with chat app Pie, which was acquired by Google.

In 2012, he took the entrepreneurial plunge and based tech-enabled artist administration platform, TommyJams, which ran till 2018.

In 2015, Nikhil joined STRIVE Ventures (beforehand GREE Ventures). STRIVE’s portfolio contains Hasura, Classplus, and Saleswhale amongst others. 

Within the newest episode of 100x Entrepreneur Podcast, a collection that includes founders, enterprise capitalists, and angel buyers, Nikhil spoke to Siddharth Ahluwalia on taking the VC route, totally different SaaS fashions in Asia, and extra. 

Taking the VC route 

An engineering graduate from Delhi School of Engineering, Nikhil studied at IESE Enterprise Faculty and Nationwide College of Singapore. He joined Pie in 2015 in Singapore. “At the moment, what made me swap to VC was the shortage of choices,” he says.

Nikhil says he at all times wished to proceed working at Pie even after finishing his research. Nonetheless, when Pie was acquired by Google in 2016, he determined in any other case. 

“One of many causes I got here out of Microsoft was as a result of I realised that I’m one of many 50 builders who was coding within the workplace…I realised that if I actually wished to have a huge impact or realise my private ambitions, I’ve to take a bit riskier path,” he explains. 

Because the function at Google didn’t excite him a lot, Nikhil determined to strive one thing new. Enterprise Capital was one thing that he was desirous about, and thus he determined to make the leap. “I made a decision to hitch the VC ecosystem for some time earlier than serious about what’s subsequent,” he says. 

Three months later, Nikhil was certain that this was one of the best factor for him — being on the opposite facet of the desk. “As a founder or an operator, you’re heads down in a single specific drawback all day, possibly for weeks. However as a VC, you’re dwelling so many various issues on the similar time,” he explains.

Nikhil says, he loves multi-taking, and the primary three months at STRIVE made him realise that he was by no means going to modify again to be a founder once more. 

World vs native SaaS 

STRIVE is an Asia-wide VC agency and invests in firms throughout Japan, Southeast Asia, and India. “It offers us a chook’s eye view into all these markets and helps us perceive the applied sciences transferring,” Nikhil says. 

Inside its fund, STRIVE focusses on two sorts of SaaS (Software program as a Service) investments. First is the world SaaS market. SaaS firms which can be serving the US or European market, and even the Asian markets fall underneath this class. These firms often come from cities like Singapore, Chennai, or Bengaluru. Inside this bucket, STRIVE has led investments in firms like Hasura and Testsigma, in addition to Southeast Asian firms like Saleswale and Healint. 

Secondly, it focuses on the native SaaS startups. These are largely Indian and Indonesian firms that concentrate on the native SaaS alternatives. Inside this bucket, STRIVE has led seed investments in firms like Classplus, Medtrail, and Construct Provide in India. 

However how does a VC handle to have equal concentrate on each market that it’s investing in? 

Nikhil says, STRIVE is disciplined, it focusses on one sector at a time, and is at present focussed on SaaS firms. “This offers us the chance to not get confused,” he says. Secondly, Nikhil says, internally, STRIVE works in another way from most VCs. 

“Most VCs have a platform method the place there’s a hierarchy — a companion, then a principal, after which the senior associates and analysts,” Nikhil says. Nonetheless, at STRIVE, they’ve internally created full-stack VCs. “Every of us, from companion to analyst and even administration of the fund, are utterly full-stack,” he explains.

Nikhil scouts for individuals on LinkedIn and reaches out to them. Later, he types the primary assembly, and those following, and at last takes a name on whether or not STRIVE ought to go forward with the funding or not. This, Nikhil believes, reduces the quantity of communication required between a number of stakeholders. 

Funding thesis

STRIVE is a seed-stage investor, and has typically been the primary institutional investor in its portfolio firms. Talking on the funding thesis, Nikhil says, “After we meet them, neglect metrics, typically they don’t actually have a product.”

Stating Hasura for instance, Nikhil explains that when he met the founders, the latter had been planning to construct a backend as a service. At the moment, they had been operating one thing like a ‘tech store.’ On one finish, they had been constructing apps for shoppers, and on the opposite, constructing a product. Whereas Nikhil discovered the staff attention-grabbing, he didn’t spend money on them instantly. He saved in contact with the founders for six months to know how the platform developed.

“Once they got here to me after six months, that they had not reached any specific metrics when it comes to clients or income or ABCs. They’d a couple of beta customers. However what was extra necessary was the imaginative and prescient,” Nikhil says.

Hasura wished to make backend improvement simple. This Nikhil, and alongside the journey, STRIVE invested within the firm. “They’ve a rockstar staff, going after a market that we actually like,” Nikhil says.

He additional explains that the answer can pivot, the product can change, and the go-to-market can change, however the imaginative and prescient will keep aligned – it must be constant. Founders must be user-focussed, frugal, and they need to be dreaming large, he provides.

“After we see product-led groups which can be frugal in nature however with large ambitions, that excites us. Metrics are irrelevant at the moment,” Nikhil says.

Early-stage errors in SaaS startups 

Talking on the early-stage errors that SaaS startups often make, Nikhil says that one in every of STRIVE’s portfolio firms that’s primarily based out of Singapore had made the error of hiring heads and VPs too early. He says, “As VCs, we’re at all times pushing individuals to construct a core staff and the center administration as a result of you must transfer away from founder-led gross sales.” 

He says that for the primary million {dollars} that the corporate generates, the founders themselves ought to lead the gross sales. If the founders lack the talent, they need to both study the talent or get a co-founder. 

Secondly, Nikhil says, within the early phases, founders don’t suppose a lot concerning the go-to-market (GTM). “Even I used to suppose extra when it comes to a product and drawback and a product-market match perspective,” he says.

Nonetheless, Nikhil believes, the product and drawback, and a product-market match goes hand-in-hand with GTM. Except an organization has the proper GTM technique, it’s tough to search out the proper product-market match. 

Nikhil additional says that the GTM pre-COVID 19 might be very totally different from post-COVID 19. He’s of the opinion that GTM adjustments each six months and the explanation GTM adjustments is as a result of the channel adjustments.

The precise factor to do, Nikhil says, is following the proper individuals on Twitter and listening to the proper podcasts. That is the place one can stay updated with how individuals are considering, after which accordingly devise one’s personal technique.