Rahul Chittora

The Indian Gen AI prosumer, consumer landscape still remains early – Companies have hit power users but are subscale OR have low % of paying users  • Companies do not have enough cohort level data to indicate product love  • Most cos who have managed to cross few hundred thousand users (MAU) are building their US GTM machine  • They have a rudimentary hallucination check AND a rudimentary RLHF in place We at Chiratae ventures are keen to look at – 1) Vernacular AI assistants - Sarvam, Krutrim are foundational model (Sarvam – OpenHathi) based general intelligence assistants very similar to Anthromorphic or Poe, but contextualized to India. They have raised significant capital, but the space remains open still. 2) Vernacular AI search – We do not have a Perplexity, Liner for the Indian vernacular. This is a potential whitespace. We will look for a solid team, with a solid product roadmap. Product risk mitigation playbooks are being built out by investors as we speak  Some companies like Two.ai are building both assistants as well as AI enabled search platforms. 3) Co-pilots for Professional services with pre-existing spend pools which can be delivered digitally – AI generated influencers, AI based gaming, digital professionals/copilots - legal professionals, counsellors/therapists, accountants Please write in to [email protected] if you feel there is something you would like to discuss. If there are products or companies we should look at, please tag them in the chat below Chiratae Ventures Sudhir Sethi TCM Sundaram Ranjith Menon Venkatesh Peddi Anoop N Mandeep Julka, CFA Kailashnath M S, CFA Tanvi Dubey #GenerativeAI #Consumer #SaaS #Technology

106

7 Comments

Indian venture market has exploded. Someone reported that there are 800+ funds/networks/syndicates/ accelerators active in Indian venture market now. Not sure, if that number is correct but if you are an early stage tech founder on your fundraise journey, chances are, you would meet hundreds of people. While majority of the fund houses are doing incredible work and shaping the ecosystem. There are certain kinds of investors you need to identify & avoid to save time and stay focused: Sharing from my personal experience, top 5 such cohorts to avoid and the takeaways for the founders: 1. Data collectors: At early stage, you don't have historical data to present. Your projections are just that, Projections. I wasted one whole week discussing with a prospective angel investor on why the CLTV to CAC ratio is x, and not y. Takeaway: Discuss high level strategic numbers only without going into the details. None of the projections would be accurate anyway when rubber hits the road. 2. Document collectors: Met few folks, who would watch from the fences and ask for n number of documents, data rooms, statements without sharing the purpose of the ask or even revealing their investment intent. Takeaway: It is supposed to be a bi-directional conversation. Say 'no' often, till the time, an official relationship is established. 3. Valuer (! investor): At early stage, valuation is a function of multiple parameters, the opportunity itself, the team, or anything else except steady cash flows, because you don't have much. I wasted another week with a prospective investor trying to justify valuation, had to shut down that conversation, after both of us started quoting Aswath Damodaran and his valuation principles. Takeaway: Too much content on the internet for both parties anyway. Shouldn't be a bone of contention at early stages. 4. Facilitators posing as investors: Met numerous people, who would go to any lengths to pose themselves as serious investors, even buying paid media articles. Only to reveal at the last: The success fee. Takeaway: Avoid facilitators until Series A 5. Brokers posing as market makers: People posing as market makers sharing tons of gyaan on LinkedIn but are actually deal brokers looking to make quick %. Personal experience: Two rounds of conversation happened and then out of blue, they added a third party in the mail trail, someone who facilitates mergers & acquisitions. There wasn't even a single instance in the past conversations where we indicated any such intent. Takeaway: Avoid name & shame in public but at least share within founder communities. #venture #fundraise #startups #investing

18

📊 Is pricing the answer to fragmenting the UPI App market? 📊 📈💡NPCI has extended the 30% market cap deadline because the top 3 UPI apps have ~92% market share. Phonepe, Paytm & Gpay capitalized on the early mover advantage. New apps don’t have incentives to compete for UPI volumes because it is a “free product.” And while this was why it grew, it has now also hindered entry of new players ✅ Global real time payment (RTP) equivalents are usually free for the customer while merchants are charged. Ex: 🇧🇷 Pix: Merchant: 0.22 - 0.3% / txn, free for user 🇨🇭 Twint: Merchant:1.3% / txn, free for user 🇵🇱 Blik: Merchant: $0.1 - $0.75 / txn, free for user 🇸🇪 Swish: Merchant: $0.09 / txn, free for user 🇸🇬 PayNow: Merchant: 1.3% / txn, free for user 📈💡 If we want to keep RTP free for the end user, the constraint is free P2P payments. Only P2M can be charged. Is that feasible? Let’s look at the data: 📌 UPI Value (in Cr): From April ‘23 to ‘24, grew by 39.6%. P2P grew from 10L Cr to 14L Cr, at ~32% growth YoY. And P2M grew from 3.2 L Cr to 5.3 L Cr, at~65% YoY. 📌 UPI Volume (in B txn): From April ‘23 to April ‘24 UPI volume grew by 62%. P2P grew from 3.8B to 4.9B, at YoY 29%. P2M grew from 5B to 8.3B at YoY 65%. And proportionally: 📌 April ‘24 Value: Total: INR 19L Cr, P2P: 72.97%, P2M: 27.03% 📌 April ‘24 Volume: Total: 13.3B, P2P: 37.5%, P2M: 62.5% ✅ The constraint of only being able to price P2M transactions is not a blocker, P2M seems to have significant volumes. But that’s the overall P2M market: There is a big segment that falls within P2PM (unorganized merchants), that NPCI will not charge 📈💡Let’s assume that P2PM majorly consists of low value transactions of AoV less than Rs 2000. If we look at AoV > 2000 bucket of P2M transactions, this constitutes for 4.50% of txn numbers, and 68.36% of P2M txn value. ✅ So even excluding P2PM this still leaves a significant~68% of P2M monthly value or 4.5% of P2M txns that can be monetized So what’s the ideal pricing model? ❗Well, the cost of a UPI transaction is ~Rs 0.4. At 13.3B UPI txns that is a monthly cost of Rs 532 Cr. Which is Rs 6384 Cr per annum to maintain the UPI ecosystem! The pricing needs to generate atleast this much❗ 1️⃣ Option 1: Fixed fee / txn: If only AoV > Rs 2000 txns are charged, then to break-even, the fee per txn needs to be Rs 15, which is high. If ALL the P2M txns are charged, then a per txn cost of Rs 0.67 would be enough to break-even. But the P2PM merchant would be impacted 2️⃣ Option 2: % of txn value: If only AoV > Rs 2000 txns are charged, then the break-even fee is 0.15%. If the total P2M value is charged, the fee needs to be 0.10%. Seems to make more sense But even if pricing comes, while it incentivizes new apps it also incentivizes incumbents to keep their market share. Enter: the 30% UPI market share cap To read the full article and other pieces like this, click here: https://lnkd.in/gSPm49aq #fintech #UPI #NPCI

32

2 Comments

Venture capital firm Peak XV Partners has about Rs 16,000 crore of “dry powder” ready for investment Just think of it, a lot of problems in the ecosystem will be solved So just be strong, focused and lean for now Sooner or later, things are going to change

15

Meet Ankur Bansal, a Senior Product Consultant at BlueStacks, who is not just a community member but also a 1% Club Commando. He has seen his stock market portfolio rise by 67% in 4 years. In an interview with the team, Ankur shares some simple but interesting insights from his investing journey till now. Here’s his full story - https://lnkd.in/dwCn4z-c #stockmarket #investing #community #financialplanning

80

2 Comments

And that’s another way of cost cutting, unlike layoffs or closing shops etc. Should we call it Ola-way!? Investing to reduce costs can easily be looked as foolhardy expense by many, but it is called “leverage” by the rare few! #innovation #leadership #costcutting #businessvision

8

Can India become an economic superpower? CNN Business published this article yesterday which is based on data and data don't lie so even if CNN wanted to deny they couldn't :-) Five data points from this article which clearly sets the tone: (Please note these points are taken from the article with some value add from my end) ✅ GDP Growth - Sustained expansion will push India higher up the ranks of the world’s biggest economies, with some observers forecasting the country to become number three behind only the US and China by 2027. ✅ Infrastructure Push - With furious construction underway across the nation. India added nearly 55,000 kilometers (around 35,000 miles) to the national highway network, an increase of 60% in the overall length, between 2014 and 2023. ✅ Digital Infra - Aadhar which is making sure all welfare programs reach to needy. UPI which has brought a lot of money flow to the formal economy. ✅ Stock market superpower - Thanks to the sizzling rally, the NSE has overtaken both the Shenzhen Stock Exchange and the Hong Kong Exchange to become the world’s sixth largest bourse. Domestic investors, both retail and institutional, have been driving India’s stock market to unprecedented peaks. ✅ Manufacturing - Asia’s third largest economy has launched a production-linked incentive program worth $26 billion to attract companies to set up manufacturing in 14 sectors, ranging from electronics and automobiles to pharmaceuticals and medical devices. As a result, some of the world’s biggest firms, including Apple (AAPL) supplier Foxconn, are expanding their operations significantly in India. Analysts have called the change in strategy a big win for Modi, as growing manufacturing ties with a US giant like Apple will in turn attract other global players in the electronics manufacturing ecosystem to India. Overall, a data based article which sets the tone very clearly that India is on its path to become an economic superpower, a clear alternative to China. The article doesn't conclude the way I am concluding my post but someone has to accept the truth! Right? **** edurigo.com #economy #superpower #stockmarket #manufacturing #jobs #growth #infrastruture #gdp #cnn #business #india

29

2 Comments

HSR Founders Club is doing an AI for GTM Fireside this Friday. Where? Most probably HSR :) If you're in a 5km radius and looking to do something before you step out, drop by. Look forward to meeting Rapti Gupta Piyush Agarwal and Akshay Hangloo. #GTM #AI

28

Tech tumbles..some reality checks Bummer! The tech industry has recently been facing harsh reality checks. Take the case of Nvidia and the latest victim of startups, Koo. Nividia stocks, which were enjoying a remarkable surge were recently downgraded to a “neutral rating” highlighting persistent valuation issues. This downgrade happened despite an impressive 154% rise in Nvidia stocks and the launch of its new ChatGPT-like tool (The good news is that they are back on track now). In another unfortunate turn of events, the Indian startup Koo (considered the Indian equivalent of Twitter) has hit a rough patch. Despite gaining significant traction since its launch in 2020 and being endorsed by bigwigs, Koo has struggled due to failed partnerships, integration issues, and funding challenges. The company's decision to lay off employees last year might have been the beginning of the end. So, what do these events tell us? Whether it’s a well-established company or a startup, no one is immune to market fluctuations, investor sentiment, consumer engagement, or industry dynamics. This underlines the need for businesses to focus on innovation, have an X-factor (pun not intended), and distinctive selling propositions, or USPs to succeed in this highly competitive IT ecosystem. Social media platforms are dime a dozen- you need to create something unique and sustainable on a global stage. Simply reinventing the wheel won’t work unless you can peddle something extraordinary. Ironically, while Koo stumbled in the Indian market, it gained traction in Brazil, as reported by the Indian Express. This raises intriguing questions about market adaptability and the nuances of global versus local success. Sometimes, starting with a bang may end with a whimper, while starting small may lead to great outcomes. Understanding consumer preferences and staying attuned to market trends is crucial for long-term sustainability. So, what do you think will ensure sustainability in the tech industry? Which technologies should one focus on to remain relevant both today and in the future? Let’s discuss… #TechIndustry #MarketTrends #Nvidia #StartupChallenges #Innovation #UniqueValueProposition #USPs #SocialMedia #BusinessStrategy #GlobalMarket #Sustainability #TechDebate #IndustryDynamics #ConsumerEngagement #FutureTech #TechInsights #Investment #Entrepreneurship #BusinessGrowth #MarketAdaptation #Koo #StartupFailure

26

3 Comments

Another notable thing from the new Budget: Space sector gets 1000 cr ($120M) VC Fund allocation. This is a very important signal, even though the numbers are small in the context of capital requirement by the sector. I am a big believer of India owning the space sector worldwide over time in a manner similar to how we have owned the Technology services market. The talent pool and infrastructure (thanks to ISRO), emerging technologies around miniaturization, and evolving supply chain makes it one of the few spaces where India has a ‘right to win’. Strongly recommend more Entrepreneurs to participate in this area. Given the high capital requirements in the initial days (before monetization), it is a hard place for VCs to play but we will see innovation in capital structure over time (the Government allocation being one such evolution). And I am not only saying this, I actually brought a company to our Investment Committee (where I am also a member) making a case for Investment. We continue to look at the space and hope to cross the line sometime. https://lnkd.in/gzB9UUb8

102

14 Comments

Here we propose building AgNet: Network of Agents in India at billion unit scale. The key components can be borrowed from Open Network For Digital Commerce (ONDC) architecture to build on the learnings of already scaled network in India. > Agent Registry: This registry holds name, description, tags, id, endpoint, public key and organization name of participating agent > The api format between agents we propose a generic conversational format to take advantage of LLM. Hence agents talk to each other using human language format. This format we are internally calling at Plotch.ai as opengroc format. This avoids headache of poiint-to-point integration amongst agents. > All agents will need to be rated to build trust in the network > Rating, discovery, register and de-register apis can be opengroc format too (or can be structured format given they can be easily defined) Eric Broda, Pramod Varma and sujith nair are key inspiration behind this and most of the thoughts are borrowed (other than opengroc format). We at Plotch.ai are just trying to stitch this as a possibility. We can all build this network together.

77

5 Comments

Zerodha’s CTO, Kailash Nadh, shares his cautionary stance on the AI hype. While 83% of companies are racing to adopt generative AI, Nadh urges a more thoughtful approach: “It shouldn’t be like, oh, there’s an LLM, where do we use it?” Discover Zerodha’s refreshing take on meaningful AI adoption and why Nadh believes not every problem needs an AI solution. 👉 Get access to the full magazine here: https://lnkd.in/gAu7PntM #AIMMagazine #Zerodha #AIHype #GenerativeAI #ResponsibleAI #KailashNadh

67

1 Comment

Our vision at Niti AI is to empower the next billion (non) developers to build and ship products with AI! Whenever I reflect on ambitious goals like this, I'm reminded of the below quote from The Fountainhead by Ayn Rand. Hari Subramanian | Aravind R. | LoopX

15

When US companies are open to hiring experienced SDRs from India at 30LPA+ ranges (1-3 yrs), Indian companies REALLY need to reconsider their remote VS. in-office culture & compensation models (at least ones focused on the US market with ACVs > 30k with decent margins) In 2021, I was offered 36 LPA for a part-time SDR role with 20-hour commitments for the EMEA market. This was a non-Indian entity and let's face it - it was 2021 - a time when salaries, funding, and spending were crazy. Even considering realistic standards (FTE role) for these packages, US companies can afford to compete with you at 30LPA + 50/50 models. Investing in remote infrastructure (culture, belonging, burnout, workload, boundaries) is no longer an option if companies are ambitious and want to scale fast In a country flooded with engineers, we are at the cusp of a Tsunami of SaaS and tech innovation for this decade and potentially the next. I only hope companies make the right choices to retain top SDRs and AEs Yes, Unit Economics needs to make sense but also be aware that now you're not just competing locally. Top talent is scarce. Very very scarce - in any function. Remote opportunities with great packages and products coupled with a solid culture (anywhere in the world) can just rip out your talent

138

3 Comments

F&O trading is similar to tobacco products and all Trading platforms and algo trading firms are behaving like tobacco companies. 91% of people make losses, even amongst people who make profits - a great percentage is less than 10K, almost 50% transaction cost for profit making. Who are the winners here - Algorithms (yes algorithms make the most money), Trading platforms(it seems there are like a million trading platforms. PS: I have little to no knowledge about F&O or trading in general. Don't mean to offend anyone but only calling it out because I feel a poor country like ours cannot have such things. Some scary messages I have read or heard in recent times - An influencer suggesting - Everything is on the chart, you do not even need to know what company is or what does it do . A trading platform suggesting - We have tools which can increase the chance of you making profit(yes this is scary - can you guarantee the increase or call out in what cases it works and when it doesn't). I got worried recently when I heard a conversation of college kids at a cafe - they were boasting about F&O trading. About how this is the path to success. I noticed they convinced two others in the group to get an account and start trading (mind you not investing but trading). The only good message in their conversation was - life is all about taking risks, worst case we will learn something out of it. I hope government and regulators take some steps to either stop it or at least put some limits and checks. At least work towards stopping passive effects like regulate influencers , fact check things, raise more awareness. I seriously do not know what is the way ahead but definitely something which is showing worrisome signs for a poor country like ours. My analysis on why it is similar to tobacco products:

51

3 Comments

I saw the documentary on Aadhaar on Docubay and can't recommend it enough. Aadhar is the fundamental building block that has not only changed payments infrastructure with UPI for you and me, but enabled direct benefit transfers for welfare schemes for millions of poor. Modi famously said: "No Prime Minister in the country can now say that I send Rs 1 from Delhi but only 15 paise reaches the poor." And, it's cost efficient - $1 for every Aadhar issued. Some fun facts and takeaways for me from the documentary: 1. A lean mean team, hybrid govt/private culture, with a mission can cross unchartered territories no one thinks is possible Nilekani appointed as Chairman in 2009 founded an efficient, persistent team with a spirit. Ram Sewak, former CEO, was an IAS officer who took to programming in his forties, and could speak Parliament, explaining good technology in chaste Hindi. Most famously he convinced the Parliament in face of mounting opposition: the total cost of this project is <10k crores but will save the country more than 50k crores/year. 2. Don't assume what others want or not. Ask them. Interestingly, when the demand generation team set out, they thought the poor in the country would be opposed to another identity card - there was already ration card, PAN, etc. A farmer told them: "I have 3 buffaloes, but if the government wants to give me one more, why will I say no?" That's when the idea of an identity as an economic asset hit home. Another interesting story on how Aadhar got its name: Naman Pugalia, a manager, was on the field with focus groups to explain the concept and understand mindsets, when an elderly man named Naiyya Ram Rathore told him this was a good idea: 'Pehchaan hi toh jeevan ka aadhaar hai.’ That was a watershed moment, and the project got its name. 3. Making your BHAG public increases commitment. Nilekani went on record early: We will give an identity to 600 million in 5 years. He did just that before retiring in 2014, delivering before its deadline. Experts in the US said de-duplication for a billion people was impossible, 10x bigger than any existing database. Even the UK had shut down its identity project for ~200mn people. But this just fueled ambition in the founding team. They built the infrastructure with Open Source tools, when none of the tech existed. Aadhar evolved to be the first identity for transgenders and solved for so many complex problems in a diverse population. But, biggest achievement: survived two opposing governments. Modi/BJP in 2014 manifesto fiercely attacked Aadhar. Yet, after winning 2014 elections, a meeting between Nilekani and Modi changed everything. And Aadhar became the foundation of the JAM (Jan Dhan-Aadhar-Mobile) trinity. -- I had the good fortune of interacting with Pramod Varma five years ago at a Thoughtworks offsite, and his talk on how to architecture solving for large complex problems came gushing back to me. You and the team are an inspiration for millions of us!

42