By exiting over 10 start-ups in the past couple of years, Riverwalk Holdings has a sizeable exposure to a number of industries including enterprise SaaS, fintech, consumer-tech and brands. This venture fund’s founder and managing partner Satveer Singh Thakral believes strongly in the growth story of Indian start-ups.
In an interview with MintGenie, he talks about the meteoric rise of unicorns in India and how they are a prelude to the continued growth in the next decade. He also says that web3 companies have shown their potential to disrupt existing industries.
He says that Open Network for Digital Commerce (ONDC) will create immense opportunities in the e-commerce space given that only 10 percent of India’s population currently use e-commerce.
Edited Excerpts:
What is your future outlook for Indian market in the backdrop of a surge of unicorns started in the recent past. This year alone, 14 startups became unicorns in India and around 44 unicorns were born in 2021 alone. Do you think this start-up boom is here to stay, or are we reading too much between the lines?
The meteoric rise of unicorns in India certainly demonstrates the strength of India’s startup ecosystem. We believe that the ecosystem is well poised for continued immense growth in the upcoming decade, with a new wave of innovative startups being built across sectors. The quality of new and repeat entrepreneurs combined with the conducive physical and regulatory infrastructure points toward a bright future.
That being said, the current market conditions have pushed founders to work on their business fundamentals, which is essential for sustainable long-term growth. The determinant of success of startups will always be a function of solving real pressing problems with innovation, rather than chasing valuations or vanity metrics.
What are your thoughts on the future of web3 companies in India? Do you think they will be able to survive amid the growing government's crackdown?
Currently, while web3 is still relatively in its early years, many companies have already shown they have the potential to completely disrupt some existing industries. We expect that trend to continue and more tangible use cases to be created.
There are already numerous Indian entrepreneurs who are keen to build companies in this space, for India and beyond. On the other hand, we can expect to see many global web3 firms with India at their core.
When there are talks of global recession from multiple corners, and large economies are facing historically high inflation and joblessness, which are the sectors that are most resilient and will continue to perform well, particularly in India?
We believe that India’s economy will not just be resilient, but will continue to grow.
Speaking from my VC lens, we are bullish on certain sectors such as e-commerce, healthcare, and fintech. This is because of certain factors coming together such as strong technology infrastructure, favorable government policies, a shift in consumer behavior and our demographic dividend.
The foundations of the India stack that the government and other stakeholders have rigorously developed over the last decade has driven the success of UPI, and in turn the fintech boom which we expect to continue. That’s also been the key driver for the transaction-led internet economy in India as compared to the western model of the advertising-led internet economy.
E-commerce and healthcare seem to be strong contenders to also leverage this tech infrastructure in this decade. The ambitious plan for democratizing e-commerce in India through ONDC is going to create immense opportunities for innovative new startups as well as existing players in this space. With less than 10 percent of India’s population currently using e-commerce, we believe that ONDC could truly be an enabler for massive digital commerce expansion in India.
Lately, fintech firms have faced a rough time in India because of unregulated lending and there are also allegations of money laundering via cryptocurrencies. What do you think about the future of fintech firms in this business climate?
The head room for growth of fintech is immense. Fintech firms that are complying with regulations and accelerating financial inclusion in the country by creating value for their customers are going to do extremely well.
You have invested and exited a slew of firms across sectors. Can you tell us which sectors and categories of companies gave the highest returns? Also, what are some of the strong trends that you are picking up in the Indian market?
Over the last couple of years, we have had more than 10 significant exits across sectors such as fintech, e-commerce or e-commerce enablers. Our most recent exit was Karza which was acquired by Perfios for $80 million showing just how robust and deep the Indian exit ecosystem has become.
Our preferred sectors are enterprise SaaS, fintech, consumer-tech and brands.
One exciting trend that we see forming is that more Indian SaaS companies are able to sell their solutions globally to enterprises either through direct or indirect channels with significantly lower barriers and higher acceptance. We believe in this decade Indian technology will be deployed in critical functions across enterprises globally.
Other trends we are excited about include tech solutions being built for product teams and developers that will enhance productivity, collaboration and faster product deployment. We also believe more solutions will be built to enable borderless recruitment for tech roles for Indian talent.
