UVC: Nitin Sharma from Antler on the Evolution of His Definition of Impact, the VC Industry in India, the Future of EdTech, How Antler India is Addressing Pain Points for Founders, and the Potential Benefits of ONDC

[00:00:00] Rahul: Welcome back to Understanding VC. I'm your host Rahul. Today, my guest is Nitin Sharma. Nitin is a co founder and general partner at Antler India and a global blockchain lead at Antler. Antler is a startup generator and early stage venture capital firm based in Singapore, backing technology companies globally.

[00:00:17] Rahul: Prior to that, with his MicroVC fund First Principles, Nitin built a thesis driven proprietary portfolio of 40 angel investments backed by marquee investors. Also, as the founder of Encrypt Blockchain, he has been instrumental in fostering India's blockchain ecosystem. And has invested in 16 blockchain projects since 2070.

[00:00:36] Rahul: Now let's talk to him. Hi Nitin, thank you so much for joining me

[00:00:40] Nitin: Hey, Rahul. Pleasure.

[00:00:41] Rahul: So, I know that you got a scholarship to study in Singapore. Was that the SIA scholarship?

[00:00:47] Nitin: Yeah, it was 1998. the world was very, very different. There was really no internet the way we use it today. And, you know, I grew up in a very middle class. I'm bringing in India and was on the track to do [00:01:00] IIT and IAS. And that was my childhood dream. Sort of view of life and somehow I ended up getting the scholarship and that changed my life quite a lot because I ended up going to Singapore to finish grade 11 and 12, and that's what opened up a lot of new horizons.

[00:01:15] Nitin: After that,

[00:01:17] Rahul: Yeah. I'm curious, you always, I think one constant theme that I've noticed, listening to your podcast and also the things that you've done in your career, impact is a common theme. Was that because your father was in civil service?

[00:01:31] Nitin: he was, he worked for the government for all his career in a nationalized bank. I think somewhere. Yes, perhaps comes from that. But, yeah. you know, I would not call that a static definition because the definition of impact has changed a lot over time. You know, when I was growing up, I thought impact meant you become an IAS officer and you try to correct the corruption and injustice.

[00:01:53] Nitin: And that was my view of life. But, later on, as I ended up in the, in Singapore and the U. S. and, you know, [00:02:00] very grateful for the experiences I had, I realized that, technology and startups and entrepreneurship. are actually very powerful ways of solving problems and creating an impact. So the definition changed, but yes, it matters to me.

[00:02:12] Nitin: It matters to me that,that, that my work is somewhat, doing some, you know, my small bit I'm doing to, to, advance sort of impactful technology and social causes.

[00:02:23] Rahul: Yeah. I'm pretty sure you're pretty good at studies, but then, curious to know what were your hobbies, growing up?

[00:02:30] Nitin: Yeah, I mean, I was very quintessential, you know, studious, although I didn't, I don't think I studied as much, but I was definitely inclined quite intellectually and, you know, the very. So your typical, get scholarships and, try, try to go for the highest rank kind of upbringing. You know, I mean, I, I, I enjoy doing things that other Indian kids did and playing cricket and, and socializing and, you know, that really was not much more at that time.

[00:02:54] Nitin: I think today's, kids today have so much more in terms of hobbies and exploring interests. you know, [00:03:00] we played in the dirt and, and, played cricket and soccer and . That was it. I collected stamps that,

[00:03:08] Rahul: Yeah, me too. That's not a thing anymore.

[00:03:12] Nitin: yeah, yeah, it's not, it's not, who uses, who sends mail anymore?

[00:03:16] Rahul: Yeah. Yeah. So, this was in Delhi, or?

[00:03:20] Nitin: No, actually, a few different places, Bombay, Louisiana, Chandigarh, my dad moved around. So most, most of my childhood was spent in the north.

[00:03:29] Rahul: Okay.

[00:03:30] Nitin: I was in Singapore from the ages of 15 to 17 and then 12 years in the U. S.

[00:03:36] Rahul: Yeah. Yeah, so you joined the VC industry in US, right at that 2008 financial crisis time, right?

[00:03:44] Nitin: Yeah.

[00:03:45] Rahul: Yeah. So, uh, what was it like, you know, joining VC industry at that moment?

[00:03:51] Nitin: Yeah. It's a, you know, it's very strange because, A lot of people who've entered investing in venture in the last decade or so have had a very [00:04:00] singularly upbeat experience, you know, things have just gone up, up and up and a lot of young VCs don't really know how to navigate a downturn. I. Was not looking for a job in venture.

[00:04:14] Nitin: Venture was a real cottage industry about 15 years ago. I thought I started my career and, you know, I did engineering, economics, math, a triple major in college in Los Angeles. And then I started, in mergers and acquisitions for tech companies. in San Francisco at UBS and, my worldview at that time was, oh, you know, I'll maybe end up in private equity or a hedge fund.

[00:04:36] Nitin: But because I was in this, in the Valley, you know, you couldn't escape the, the, the lure of sort of startups and tech and Facebook was just taking off. And so on one hand, we were working with multi billion dollar deals with, you know, Rupert Murdoch and News Corp selling assets. and on the other end of the extreme, I saw.

[00:04:55] Nitin: We were dealing with pre revenue, pre product startups, but that part fascinated me quite a [00:05:00] lot. And, I assumed venture was a place where old people who had sold companies went and deployed their own money. And, you know, from an information access, knowledge, network perspective, it was a very closed industry.

[00:05:13] Nitin: It is very different, today, but at that time, I wasn't looking for a career adventure as it happens in life. Most of the best things are surrender bidders and, new enterprise associates was, one of the largest, the actually the largest VC fund at that time, and only a few funds like Sequoia NEA, were expanding to do larger deals.

[00:05:31] Nitin: And that's where they felt someone young could come in and help, right? Because what do I, as a 25, 28 year old, have to teach anyone about running a business? But, but when you start doing larger deals, some of that skill set can be helpful. And so that's what it took me to, you know, I luckily got recruited.

[00:05:48] Nitin: I'm very, very grateful to be, to have learned the ropes of this business from some of the world's best investors at NEA. And, really just the learning curve was so steep. [00:06:00] My first meeting was, my first day in venture. I sat in on us approving some 50 million investment in a company called ProtoStar, which was basically, let's say, sending satellites.

[00:06:11] Nitin: And, and then it, you know, the next day it was gaming and the next day it was e commerce. And I realized how much learning there is, to be done, you know, and how steep that learning curve is. And it was a very inverted pyramid structure. I was the only associate, actually one of two associates, supporting maybe seven or eight senior partners.

[00:06:32] Nitin: So very steep learning curve, very inverted pyramid. so you basically, and you have no idea how to run anything or invest in venture. And you are working with people who have done it for 30 years. So you really get challenged to, to up your game and, and be humble and learn. And you realize how stupid you are, every day, you realize how little, you know, and that's been a gift, I think, for me.

[00:06:56] Nitin: And then the other aspect, as you pointed out, was that it was [00:07:00] happening in the aftermath of the financial crisis. So for the first 12 months or so, I don't think I saw any up routes. I saw bridge routes. I saw layoffs. And I thought that venture was really about say, you know, helping companies navigate tough times.

[00:07:15] Nitin: And, finally in 2009, 10, of course, I saw a lot of things go up as well, but you know, that experience was a, was a nice crucible to make me understand what venture actually is. What has happened in the last five to 10 years has been kind of a, an aberration, you know, it's, it's a, it was a boom cycle, which.

[00:07:35] Nitin: Lasted for a long time, but actually now, you know, we are back in, in times where the fundamentals matter and good founders and good companies are built the right way.

[00:07:45] Rahul: yeah, what would you say was the most important lesson that you learned from your time at NEA? Yeah. Yeah.

[00:07:54] Nitin: I think being able to think big is not [00:08:00] something that's natural. even if you come from, you come from many analytical backgrounds, like consulting, banking or engineering, et cetera. Right. And,you get, you, you really start to. Notice what is wrong in something.

[00:08:13] Rahul: Yeah.

[00:08:14] Nitin: I think one anecdote, which, or one gist of venture, which crystallized things in my head came from one of my mentors and somebody who recruited me at any year, a very successful VC called Harry Bella, who unfortunately passed away a few years back, very untimely and far too young to pass away.

[00:08:33] Nitin: But, you know, he, he had sort of, he had this knack of seeing the best in people. sometimes before they saw it themselves. And, his philosophy of venture was anybody can find out what's wrong with a business. You know, when you come from analytical backgrounds, it almost feels like you're smart to be able to say, Oh, this can go wrong.

[00:08:55] Nitin: The margins are not high. The working capital may not work. The technology is okay. Right. [00:09:00] All the buzzwords that we throw around, but great venture capital is not about looking at what can go wrong, but what can go right. And to be able to imagine. If it goes right, how will the world change? Will it really disrupt an industry, a value chain?

[00:09:14] Nitin: Will it create a new category? Is this an iconic founder? It's like, you know, the potential to create an iconic company. You know, things like that are very hard to pick up early in your career. it only comes from experience and pattern recognition, which is why, you know, we see as an apprenticeship business, like the medieval times, you know, you had these guilds and apprentices.

[00:09:32] Nitin: and I think that what Harry taught me or what my time at NEA taught me was adventure kind of comes down to two things, right? if that founder, if what they, he or she is saying. It's right if they're, if everything goes right, what does the world look like? Is it big enough? And secondly, are you looking at a founder who will walk through walls and do everything necessary to make it happen?

[00:09:59] Nitin: [00:10:00] And that's it. There is really nothing more to early stage venture capital, late stage. You have many other considerations, but, those two things, right? To be able to imagine big, what does big look like? Is, is, is a, is a skill that, that I am still trying to. Hone after 15 years.

[00:10:16] Rahul: Yeah. Yeah. Well, Vinod Ghoshlai has been tweeting a lot these past two days, and I came across a tweet that he did, like, posted yesterday or something, where he says something like this, yeah. If you bring, like, a non consensus opportunity to a PE guy, he would still look at the top line. He will not still be, I mean, his argument at least is that he'll not be able to see the, the, how big this can get.

[00:10:43] Rahul: yeah. Uh, how different is it like becoming a VC, in the U S when compared to, um, one in

[00:10:50] Nitin: so, you know, one of the things I did after my, initial period at any, where I finally learned how to analyze investments and venture [00:11:00] and also start to earn the trust of founders, you know, I think that are three phases. one is you, you learn how to become, you learn the basics of venture investing.

[00:11:11] Nitin: The next thing is you try to learn the ability to. support, influence founders and, add value, you know, I know that's a cliche thing, but a lot of it comes from operating knowledge. So I'll share another, I think you didn't ask me this question, but I will still answer it. one of the things I did, we, I led our first investment, in ed tech, co led our investment in a company called Everfire on the East coast.

[00:11:34] Nitin: and, I then went and worked at Everfire for a year and I just wanted to understand what it is like to build something because, you know, I had in banking and VC, I had seen the side of writing memos and making models and sitting in these very plush offices. But I went from that to a garage, literally a garage, we were just funded, at, you know, with a sizable series A, but it was [00:12:00] literally just a team of five or six people.

[00:12:02] Nitin: And, and I went through the, that phase of a hyper growth phase. we quickly went to 50 people, acquired a company that I found on in Boston and I wore some hats, including sales and product for a few months. And so, and I got my ass kicked, I failed a lot and I realized how hard it is to build something and how easy it is to analyze and criticize it.

[00:12:27] Nitin: And that to your question is, I think because, the USBC has had many more people proportionally who've gone through an experience on the operating and entrepreneurial side. typically you have a different level of empathy and a different level of support. and, and also look, the ecosystem is far more mature, right?

[00:12:45] Nitin: people have gone through many, many iterations. So, I mention all that because it really informed my style. after my time at Everify, I realized how empathetic one needs to be at early stage as a VC. And how the way you add value is [00:13:00] not by talking, but by trying to actually solve some problem for the founder.

[00:13:04] Nitin: And that's something very hard for young people, anyone young in VC to pick up. And that's why I struggle through that also. I think some of the differences, so one is maturity of the ecosystem, right? Very different. and that means that people are faster at iterating. I think there are also less founders in the U.

[00:13:21] Nitin: S. and so the process of, if something's not working, going to the next thing is faster. I think a lot of Indian founders also because of the economics in India, you can stretch out something for a long time, even if it's not working. And frankly, um, it's a very hard decision because on one hand, the founder, you don't want to question the founder's belief in what they're building.

[00:13:42] Nitin: This is their baby. On the other hand, sometimes things are very obviously not working. So some founders able to strike that balance quickly and say, Okay, I'm going to give it three months. If it doesn't work, I'm going to shut and move on. Some founders feel I feel like end up dragging it for a while. And we see a lot of [00:14:00] zombie startups in India for that reason.

[00:14:02] Nitin: I think, big thinking big is another difference. there is a reason why we still don't have sort of I'll say something and I'll caveat it. We still don't have sort of crazy levels of ambition, right? but it's changed a lot. I just finished 10 years last week of coming back to India. when I moved back, almost every pitch was X for India, Uber for India, Tinder for India, Amazon for India, you name it, right?

[00:14:30] Nitin: And copy paste was sort of the default. I don't see much of that today at all. In fact, and I love that, right? Indian founders today are thinking more originally. We have more on the ground innovation. We have more things to do. In India or in various sectors. So founders are, you know, both in terms of their experience and in terms of their thought process, far, far more mature, than 10 years ago.

[00:14:55] Nitin: But I think at some level still, I don't see sort of the crazy [00:15:00] ideas yet. Right. Which will be sort of truly industry changing. They're there, but, but proportionally few. and I think finally I would say, You know, the economics of the venture industry are also very different, right? Even with all the changes in the markets in the last few years, with more IPOs happening, more liquidity, it's nowhere in comparison, right, to the pace at which companies scale and go public or have outcomes, which means that that's important because it reinforces belief in the venture asset class.

[00:15:33] Nitin: When outcomes happen and money is recycled to LPs. it makes a big difference, right? India has some, there are some fundamental challenges to the economics of venture capital. Should we have 10 year funds? Is that enough? Maybe India should have 12 or 15 year funds. maybe companies in India should list sooner, even if it's, smaller outcomes, right?

[00:15:53] Nitin: I don't know. I think this is all evolving, but structurally there are challenges, which also are opportunities in India.[00:16:00]

[00:16:00] Rahul: years. Yeah. What do you think are some of the things that founders in India don't understand about BCs?

[00:16:06] Nitin: it's a good question. I do this workshop for our residency founders at Antler, and I'm happy to, you know, like to chat more about what we are doing at Antler differently in a bit. But what, what I realized on those sessions is. so think about it this way, 30, 000 founders have applied to us. That's a massive funnel and that's just the last two years. and we've invested in maybe 40 companies, right? so you can imagine that 99% of the time you're saying no, I mean, more than 99% of the time. So, and, this happens across the board at other VCs, in different ratios, and so a lot of founders are very disillusioned, right?

[00:16:46] Nitin: Why? I have a good idea. I can have a good business. And why, why would a VC not fund me? And, it creates a really, negative image of venture and some of it is justified, but some of it is not. I think, [00:17:00] what entrepreneurs don't understand is the math of venture capital. The math that, goes into the thinking about how a fund is...

[00:17:09] Nitin: constructed and, and the LPs on the other hand, who fund venture funds, what the expectations are, right? So I do this one or two hour session where I walk founders through, okay, if any sales process, you should know your customer, you know, you know, in the VC sense, do you understand your customer's mindset?

[00:17:27] Nitin: What are their numbers? What are their constraints? Who have they gotten their money from? What do those investors expect? and when you go through this, right, to cut to the chase. You realize that venture capital, is fundamentally aviation or rocket fuel. and, and people have heard that analogy, but don't internalize it.

[00:17:47] Nitin: It's meant for a certain type of business trajectory. you don't put aviation fuel in a car or a rickshaw. There's nothing wrong with a car or a rickshaw. There can be great businesses built a certain way, but venture forces a [00:18:00] certain trajectory. You have to become big, big with a capital B I G. and fast.

[00:18:07] Nitin: So the combination of big and fast is not natural to most businesses and especially in a higher friction, low trust country like India. So very few things, can generate the kind of returns. And I, um, Nathan, uh, from zero, the retweeted the last week at something about Tam and Overestimation of tam and that's something which has also been hot topic for, for a while.

[00:18:30] Nitin: And I think he's partially right, I mean, largely right, India, Tam and India scaling. for a lot of businesses doesn't fit the way venture returns can be expected, you know, when you look at what needs to happen in a five to seven year time frame. And, I think if founders understood this better, in India, they would, look at whether venture is right for them at all.

[00:18:52] Nitin: And this obsession with ventures needs to stop. I think we have glorified venture too much in India. Like [00:19:00] I don't find VC to be that glamorous, honestly, I don't know why so many people, I think it's a service profession. I think you are serving founders. And raising money is like being in a petrol pump and you refuel and you move to the next stage.

[00:19:17] Nitin: And so I don't think that a funding round is necessarily that much cause for celebration. It's, you don't celebrate every time you go to a petrol pump, right? So I think, I think venture funding, venture rounds, taking venture capital is being far too glorified. It is right for a certain kind of business and it is wrong for most other kinds of businesses.

[00:19:36] Nitin: Unfortunately, it is the general paucity of other options that make people look at VC and then they get disappointed when either it doesn't match or even if they get funded, then the VC tries to force a certain growth trajectory, and that's not natural to the business in most cases. So it's not an easy problem to solve.

[00:19:57] Nitin: I think we need many more other [00:20:00] types of funding models. But look, I can only do what I can do from my vantage point in BC and I would advise founders to think very hard before they, before they sort of go down the BC path.

[00:20:10] Rahul: Yeah. Yeah. so. You, you worked in the EdTech sector. I, I just want to go back to EdTech for, for a bit. I'm curious to know why you are interested in EdTech in general. and there's also that question, especially in the US whether that's a venture backable sector.

[00:20:29] Nitin: So I, I, I became interested in it again, like most things in my life have been accidents. In 2010 or 29, 2009, I was, reaching that third phase of, my journey and like as an, as an associate, say, okay, what are the new spaces I can look at now? I was at a fund, which was one of the largest in the world.

[00:20:50] Nitin: And there was nothing that I could. As, as a young guy find, but, it occurred to me that we had a trillion dollar sector where NEA had not done much and [00:21:00] for good reason, ranging from regulation to sales cycles, et cetera. And that was education. and so I started to see that there was some very large online businesses, you know, like from the University of Phoenix is to virtual schools that had come up in the US And, and you know, it's, it's a, it's sort of a counter cyclical or a cyclical sector.

[00:21:21] Nitin: That historically does better in downturns and so when 2008 was a downturn, a lot of people were going back to school. And so the, and, and more and more you realize that with the cost pressures at schools, you know, technology was becoming, important. And I just felt that there was an inflection that for a long time, this sector that had almost looked down on software and technology and had very traditional beliefs about how teaching and learning should happen.

[00:21:47] Nitin: was evolving. And, before from K 12 and college, there was some very interesting companies, new businesses getting created. And then, of course, when I turned to Asia, there was a completely [00:22:00] different set of math, right? you had much more of the spending happening from the consumer pocket. In the U. S.,

[00:22:08] Nitin: EdTech is funded with federal taxes for college and local taxes and state taxes for K 12. In India, private expenditure is a much, much bigger percentage, same with other parts of Asia. So it just felt like a sector which was very ripe for innovation to come out of Asia and also for some very big things to happen here.

[00:22:28] Nitin: So anyway, that's how I got started and I always was very fascinated by pedagogy and, you know, from a social in it. so I looked at a lot of things in edtech in the U. S. in India as well. I helped, uh, a venture get started. And then later on, as I was investing, at first principles, which was my micro VC made some other bets. So I wouldn't say that I'm, an edtech focused investor today, but I continue to, in fact, I believe right now is a good time for edtech because I think with what's going on with some of the [00:23:00] larger players, people are writing off ed tech, but if there is one thing India will pay for, I mean, apart from games and, and gods and, Bollywood, et cetera, it's, you know, education and, and, the promise of a better life and better employment.

[00:23:15] Nitin: So I think, fundamentally what has, and I was talking to Zeeshan who founded Topper and made a good point that the combination of high margin, high quality. and, and sort of, you know, low CAC is very, very hard. And so I think there's some triangle of, you know, what kind of businesses can create that.

[00:23:35] Nitin: And I think, I think there'll be a new wave of edtech companies in India. With fundamentally better economics. I'm absolutely positive on the sector. and hopefully we'll do more to antler.

[00:23:46] Rahul: Yeah, I think, the fact that, you know, if you bring in AI to this, a lot of things can be a little bit more scaled up

[00:23:54] Nitin: I think it's the number one, space, for me from an India perspective in terms of where [00:24:00] AI will make, a big, the most big guest in fact, impact. Right. I think, not just the cliched or every, who's not able to afford a quality school can now get a tutor. Sure. That's one thing, right?

[00:24:14] Nitin: The social impact aspect of it. But, I think, I think when you layer this on top of our existing challenges, you know, it's, it's, it's fascinating when you look at all the self learning that this could enable, at a cost and quality, which was not possible a few months back. So I don't know what the right businesses to come out of that yet.

[00:24:38] Nitin: We are spending some time thinking about it. But, I think, I think education, I think, generative AI. Applied to education is a far more interesting area than some of the other things I'm seeing right now.

[00:24:49] Nitin: yeah. And I've also, heard you talk about, you know, interest in, working on education policy, in the country on a different podcast. So, well, yeah, [00:25:00] well, what would you do? Oh, that's a, Rahul, that's a, that's like a separate hour long podcast. I'm not an expert on pedagogy, but I, I just think that, I think everything needs to be relooked at. Why we have certain curriculum and certain grades. have we thought of actually matching that learning to 21st century skills?

[00:25:22] Nitin: have, do we, you know, you, I don't, I don't think to the best of my knowledge, and I may be wrong, like no one's done a very, very thorough assessment of whether what we teach is applicable in the world of today, right? And, and, and I'm not for like eliminating curriculum in, in mass, in a big way, but I think that it just needs to be relooked at, right?

[00:25:44] Nitin: And. And then, of course, the outcomes are just not working, right. I mean, I think, while we keep talking about the demographic dividend, I'm very concerned about sort of the educational outcomes that the vast majority of students come up, come out with, I think most of the degrees don't [00:26:00] mean anything.

[00:26:01] Nitin: They're just pieces of paper. And, when you go beyond sort of the lucky, top 10, 15%, you know, I am, I, I highly doubt that the educational outcomes we are delivering to millions of children and Young people are, are, are well suited, especially in the new world of, you know, AI where, sure, some of it is just about productivity gains and 10x, but there will be massive displacement in some areas.

[00:26:24] Nitin: And I'm not sure what that will mean for India.

[00:26:27] Nitin: Yeah. Yeah. so now I'd like to know more about what you guys are doing at Antler. and,I understand that you guys are in the company building game rather than the deal flow game that usually VCs are in. yeah. So a couple of things, like how do you think about, you know, Reducing the cost or having a lot of experiments done in trying to create a lot of startups. Yeah. So just for quick background, right now with my co founder Rajiv who built Urban Ladder and has gone through a fantastic founder journey, I [00:27:00] combined sort of my investor journey to start Antler India, which is, the brand of course is part of the global, brand of Antler, which was started by a gentleman named Magnus Grimland in Singapore.

[00:27:13] Nitin: We are a five year old global venture platform, which may be the fastest growing. We are in 25 countries, 25 cities already. and we may be the only investor that is physically present in so many places. And the reason for this is we are trying to create a network of funds and teams in various countries that are focused on the day zero investing, as we call it, which is really to help people start companies, right?

[00:27:40] Nitin: we don't think of ourselves as in the deal flow game as much as in the company creation game. we think those are the problems which are not solved yet. money later on is abundant, but a

[00:27:53] Nitin: structured way to early stage investing has been missing. and that's what we are trying to create in various, with various [00:28:00] funds.

[00:28:00] Nitin: So for example, in India, Rajiv and I are, are really focused on, we started in, back behind the scenes in 2020 and launched in a full fledged way, in 21. And really we asked ourselves what is missing, what do the founders need? And we realized that at that minus one to zero, as we call it, when someone's thinking about starting a company, there are some pain points.

[00:28:23] Nitin: Which are right now being not addressed or addressed in a very fragmented way. So we work and respect with a lot of angels and micro VCs and I ran a micro VC myself. So I think there's a great ecosystem and there are some great people, but there isn't a structured way of doing this as a platform, as an institution.

[00:28:43] Nitin: Right? and so we have a lot of people who are solo GPs and micro VCs and that's great, but we want to be that platform where a founder can begin their journey in the ideation phase. Solve problems like validating an idea or finding a co founder, and those are things which nobody else is doing, or doing the [00:29:00] way we are doing.

[00:29:01] Nitin: And then we also become their first believer at pre seed. We give them capital before sometimes a line of code has been written. And these are, you know, significant amounts like 300k, 350k, sometimes even before they finalize the co founder or an idea. and, then we want to be their partner for, So we have a capital structure that allows us to invest in pre seed and seed from this fund.

[00:29:26] Nitin: And we have a continuity fund that can also invest in series A's and B's, in those companies. So that's a little bit about, and the other part of it is plugging all of them into a very global network on day one. So we have a lot of founders building in India for India problems. We also have a lot of founders building for the world from India.

[00:29:46] Nitin: In areas like AI and SAS, vertical SAS, DevTools, Climate, Web3 infrastructure. and in all these areas, the world is very different today than it was 5 or 10 years ago. If you started a company in 5 or [00:30:00] 10 years ago, you may have had the mindset of like building a certain product for India, building a team for India, and then thinking about going global.

[00:30:07] Nitin: today you have Gen Z's become founders. You have people think very differently about all this on day one and a lot more global ambition. And India is a fantastic place to build these kinds of startups. So, but what really helps is if you are plugged into a very global network on day zero, so that you are thinking about your product differently, you're thinking about your team DNA differently.

[00:30:30] Nitin: So that's what we are enabling by stitching together all of these antler funds in one powerful global network. So we have hundreds of startups and thousands of people who can. be accessible for, for, as a customer, as an investor, as an advisor, and so on and so forth. So that's a lay of, sort of, some background context on Antler and Antler in India.

[00:30:49] Nitin: I think to your question on what is, you know, what is different about PSEED, fundamentally, it's about the founder. we, we, [00:31:00] we don't think that early data means that much because ideas and, And prototypes and all change quite a lot, but what is far more important is getting the founder right and making sure you have the right founder market fit.

[00:31:14] Nitin: So we spend a lot of our time thinking about why someone wants to be a founder. What is it that they're, what makes them the best founder for the kind of venture that they want to build and have they really thought through who the right co founder is? And so we focus a lot more on these foundations before the building is built.

[00:31:33] Nitin: and, and we think that that's a very, very important phase. And if you can go in with a lot of clarity and conviction around the why of why you're doing it and the who of who you're doing it with, then the what and the how becomes easier.

[00:31:48] Rahul: Yeah. And you're mostly looking for, future founders in colleges or?

[00:31:54] Nitin: No, I mean, we want to democratize entrepreneurship. we really do. And that's sort of the mission [00:32:00] of Antler. So. I'll give you some examples. So, you know, 30, 000 applications from all over India, a lot of people from tier two, tier three cities also. we, we really try really hard to start with no bias around founder backgrounds.

[00:32:16] Nitin: those who end up in our cohorts and then of them, those who start companies and those get funded by us. It's a, it's a, it's quite a mix. we have a persona of someone who, you know, so for example, I think this year we have committed to nine or 10 investments and all of them have been repeat founders.

[00:32:35] Nitin: So Antler is not a place only for sort of first time founders. We actually see a lot of repeat founders. One stat that surprises some people, if I were to ask you, look at the thousand unicorns in the world, what percentage of them had founders who had never worked with each other before or gone to school together?

[00:32:58] Nitin: Because conventionally people will [00:33:00] think that most successful companies are created by a team that went to school together or work together. And so you may be, your guess will be like, well, maybe 80%, but, but actually, 34%, of founders, actually maybe 38, I think, is, if you look at the unicorns, right, 38%, at least a third. work together or go to school together. They came together for the purpose of starting that venture. And then they got to know each other for a few months and started working together. And that's what we are trying to create here, right? With what's called the Antler India residency. So in the residency you have individuals who come in from various backgrounds.

[00:33:39] Nitin: Some are first time founders, some are second time founders. You have, some. young folks who've spent two or three years in a startup and now want to start. You have another persona who are like directors or VPs at Unicorns who want to start. You also have some people who spent a long time in a corporate career and not been in Unicorn who have some unique insight [00:34:00] and want to partner with a tech co founder to start something.

[00:34:03] Nitin: So it's a mix, Rahul. It's quite a mix. we don't start with any bias. I think great founders can come from any of those backgrounds. We also have something called the Antler India Fellowship, which you talked about, I think, which is specifically for college founders. That's a grant we give. it's not, some people call it the Thiel Fellowship of India.

[00:34:21] Nitin: that's nice, but it's not meant to make people drop out of college. It's meant to give them a grant to experiment. And, and then if they want to pursue a venture, then we can look at investing in those ventures as a first believer. but it really is money for them to go to their mom and dad and say, listen, mommy, I have this, these folks who selected me out of 2, 500, 3000 people, they've selected five or six, I'm one of them, and they are giving me some money, which is, let's say, one or two years of salary.

[00:34:54] Nitin: So please let me just do my startup and I don't want to, work [00:35:00] in a job and, you know, that kind of gets over the fact that a lot of students have financial pressures or may have a loan and that gives them their parents like confidence to support them as well. So, that that's sort of our initiative to democratize entrepreneurship outside of.

[00:35:15] Nitin: You know, IITs and BITs also, we have a lot of students from them from there, but we also have students applying from 700 other colleges in 375 cities all over India. So It's quite, it's quite a range.

[00:35:29] Rahul: Yeah. So, beyond a democratization, the goal here is also to reduce the cost of, you know, you can call it these, the experiments of trying to build a startups, right? Do you see it that way or?

[00:35:43] Nitin: Yeah, so I know you asked that earlier That that is part of the goal, right? So it it happens in a few ways One part of it is again the team, you know, you can run the same experiment with the wrong co founder and it will fail [00:36:00] So I think one way we try to minimize the risk and maximize the speed is, is the right kind of team coming together.

[00:36:09] Nitin: By the way, just to be, we also invest in existing teams, you know, directly. It's not that we only invest in individuals and make them form teams. That's one way, that's the residency. And we also invest directly in teams, which are existing teams. But, so one is a team, the second is, the cohort itself becomes a very powerful way of getting feedback.

[00:36:30] Nitin: So one of the things that you notice is if people are just sitting in a cafe and ideating on something and organically talking to a few customers and, they don't realize that they could do this faster and more efficiently. You put that, you put 60, 70, 80 of these people in a cohort in a very structured setting and you set some timelines.

[00:36:53] Nitin: They draw a lot of inspiration and support from each other. So the cohort itself becomes a mechanism for them to test their [00:37:00] hypotheses, get feedback from other founders and, and, move faster. Right. And then the third thing is sort of, idea validation in a structured way involving our team. So the, I mentioned the session I run, which is around venture backup scalability, you know, Rajiv does the session.

[00:37:17] Nitin: Our team members are mostly, many of the leads are ex founders themselves. So we do a lot of, you know, in a three to six month time period, we do a lot with pretty much every team that gets formed to give them feedback very quickly on what makes their idea less venture scalable or more. And of course, we don't force any way of thinking.

[00:37:38] Nitin: We just tell them this is what's going to be a risk. And I think sometimes founders have really appreciated. Quick feedback so that they don't go down and waste three to six months, and running into a wall, right? Because we have seen so many similar situations, so you can share that pattern recognition.

[00:37:55] Nitin: and, I think so as a combination of those three things, we certainly feel that your [00:38:00] clarity of validating your ideas is, is strengthened in this process.

[00:38:05] Rahul: Yeah. Yeah. And earlier you mentioned about, uh, uh, the Zerodha founder, uh, making this argument that we completely overestimate a lot of these opportunities in India. And it's partly the fault of VCs as well. I'm slightly on the fence with this because it's not just in the EU. In India, right? In US also, this keeps happening all the time.

[00:38:26] Rahul: And if you look at SoftBank, they have overestimated a lot of things and another thing is, is also the size of the funds, right? That force you to do things like this.

[00:38:34] Nitin: Yeah, I agree, agree with all of that.

[00:38:37] Rahul: But there's another argument that you made. Where you mentioned last year that we are overestimating the number of opportunities. That I, I believe is true because you know, at any given point of view, you can't have a, I mean, if you look at historically also, there are not many large outcomes

[00:38:56] Nitin: Yeah, so look, it's, you know, as I say, India disappoints both the optimist and [00:39:00] the pessimist.

[00:39:00] Nitin: I think a lot of things in India are overhyped in the short term and underhyped in the long term. So, and look, I think I talked earlier about structural problems in terms of venture returns, how fast companies go to public markets, all of that.

[00:39:16] Nitin: But I am, I'm obviously one of the biggest believers in, in the India story. And, I, I think that those things will also correct, right? I, I, I try to be balanced about it, but I think we have to be very optimistic and, you know, venture and startups require somewhat, sometimes even slightly delusional optimism.

[00:39:39] Nitin: Right. And I think that I, I look at a lot of counter examples where change has come faster than you would realize. I mean, UPI, FinTech, being probably the best example, or also just. How quickly behaviors have changed around, at least the top five, 10% of India, urban India, right around [00:40:00] technology adoption.

[00:40:00] Nitin: I mean, I look at five to seven years ago, if there was so many naysayers about, nahi India mein nahi chalega, right? It will not work in India. Consumers will never shop online in that way. Brands cannot be built on, you know, digitally in India. How will people trust a new product? Venture startup, you know, the big conglomerates will destroy everything.

[00:40:26] Nitin: There is no opportunity for venture backed startups. talent in India is not good enough, right? We can never build world class companies. India can only be a services destination, you know, all of that is junk, right? So I, I think that, I think either extreme of sort of, you know, thinking, hyping India too much or, or, or not believing that some of these things are possible is, is incorrect, right?

[00:40:55] Nitin: So I actually have a belief that in five to 10 years, we will, be very [00:41:00] positively surprised in some areas. And what gives me confidence is also how quickly physical infrastructure is. is catching up to the digital infrastructure, if you will, right, like I think India has probably, at least in, in the major cities now, you know, we probably have the world's best digital infrastructure or comparable in many cases, like payments and logistics and, you know, e commerce, etc.

[00:41:25] Nitin: We don't have physical infrastructure that's world class, but I think it's catching up a little bit, you know, faster than what had happened in the past. And then you look at what's happening in the world geopolitically and all of that, right? So I think I'm more bullish on India than I was earlier in a way, right?

[00:41:43] Nitin: and we, we, I'm very bullish on some of the new things that are coming out in digital public infrastructure like ONDC. And, you know, we've, we've gone very, very early and we've published a thesis and done some investment. I don't know for sure if a hundred percent I can guarantee that [00:42:00] all the stars will align to make ONDC or e commerce as decentralized as, as it can be, but I think if it does, then you have, a very, very significant tide that can lift many, many boats.

[00:42:13] Nitin: So I think you have to look at what new is possible rather than look at the constraints, right? One other example, which I think right now, Web3 is obviously dead in people's minds, but I still look at, look at Polygon. you know, one of the beliefs for me has been, India was in the 90s, we were a services economy.

[00:42:35] Nitin: I mean, on the tech side, at least, we started to move towards horizontal SaaS, which was. Cheaper SaaS, cheaper than some U. S. alternative, not necessarily better, but cheaper. Then you went into areas like developer tools and vertical SaaS and consumer brands where it's not just cheaper, it's better, or sometimes it's not even cheaper.

[00:42:59] Nitin: And, [00:43:00] but one thing that's not happened is India has not created a platform company. So you go from services to products, but not platforms. And trillion dollar companies are all platform companies. The Microsoft's of the world or Amazon's of the world. And how far is it before India creates a platform company and Polygon, I think, is the first example of the potential of that happening, right?

[00:43:23] Nitin: in, in web three to start with, and I think it can happen in many other areas over time. and digital public infrastructure from India provides an interesting template. so yeah, I mean, I, I think long story short, I agree that venture is sometimes not right for most opportunities in India. I agree that TAMs are overestimated.

[00:43:43] Nitin: I agree that, you have fewer billion, multi billion dollar ideas coming out from the founder universe right now. But I think there is plenty of other evidence that should make you bullish and continue to believe in the India story.

[00:43:59] Rahul: [00:44:00] Yeah. And you mentioned about the lesson that you learned from any, but job of the VC is to be see the optimistic side of things. Right. And to see

[00:44:08] Nitin: Early stage. Yeah. The early stage part. yeah, I mean, believe in great founders and just support them and let just watch what happens. And you have to be, you know, venture as a career is a very strange career. You have to be very, very patient. if I, since I've been waxing philosophical on a bunch of things, I'll, I'll give you some tidbits on this as well.

[00:44:32] Nitin: Right. It looks like If you think about venture, it's a very strange career, which is why I don't, I, I advise most young people to not consider venture. I stumbled into it and I love it. And I'm now at a stage where this is what I do, but I encourage most people to think harder about operating businesses and building something, rather than getting fascinated by venture because it's a, it's a very strange career with very long [00:45:00] feedback loops.

[00:45:01] Nitin: It takes five or 10 years to, for something to become successful. Second, it's mostly luck. And I know that's a controversial statement, but I personally believe that most Successes have too much more luck involved than meets the eye. I've seen fantastic VCs work very, very hard, think the right way, end up with some failures, and vice versa, somebody who's not that stellar seems to strike some home run.

[00:45:31] Nitin: And I think it's because a lot of the factors that go into whether a company becomes mega have to do with external factors outside your control over a period of 5 to 10 years with hundreds of variables. So, it's mathematically impossible to Engineer too much success. I think luck is a big factor. Third, you know, your entire journey is dependent on how founders perform, right?

[00:45:54] Nitin: So it's not something you fully control. and, it's a services profession, right? [00:46:00] So I'm saying all this not to dissuade people from, I mean, I think I'm very grateful to be in venture, but I want to say this because, um, I is, at least early stage. So you should know all this and even then, if you feel like this is the career for you, should you go into it? Right? Not because it is glamorous or because you, I think any VC, especially young VCs, if you think about like, I see a lot of cockiness sometimes and I'm like, why? Like you are not the main reason why, or even sometimes not even a reason why a company becomes successful.

[00:46:40] Nitin: Like you are just a facilitator and a check writer and you're a petrol pump gas attendant. You're a petrol pump employee. Okay. And that's wonderful. There is nothing wrong in that, but that's what you are. Right. So, I see a lot of young VCs sometimes have, I mean, look, I've, I've, I've just been humbled over the years and I don't think there's any [00:47:00] reason for cockiness in, in the venture world.

[00:47:02] Nitin: so yeah, it's, yeah, but you're right. I mean, that job of the VC is to still believe despite all of this.

[00:47:07] Rahul: Yeah, and you mentioned ONDC, so, and Web3, so I see a parallel between Web3 and ONDC. any Web3 marketplace, at least in theory, can unlock a lot more of value than the existing marketplace, right? So, love to know your thoughts about

[00:47:29] Nitin: That's a great question. very nuanced. Yes. see. ONDC doesn't start with, decentralization as a goal. ONDC, I think, in my mind, starts with the idea of, uh, enabling all the various sellers who are not selling online today to come online. And to enable a different value chain and a different cost structure.

[00:47:56] Nitin: I don't see it as sort of starting with the thesis [00:48:00] that a certain e commerce company is bad and it needs to be disrupted. So that's a very important thing to understand. Some people think that ONDC is anti Flipkart and anti Amazon. I don't see it that way. I think there's a lot more win win that can be created for the existing players also.

[00:48:19] Nitin: Now with that caveat aside, yes, both Web3 theoretically and ONDC theoretically essentially create a decentralized way of doing commerce, for example. I think Web3 introduced this concept of bootstrapping and network effect and getting community participation before you build a business and raising from that community almost and making them stakeholders in that common infrastructure.

[00:48:53] Nitin: And I think that's a very interesting, powerful idea. And I think we hopefully will have a world where more businesses will be built [00:49:00] that way. And I continue to be a big believer in Web3 in general. But this part, I'm a little less sure about today, because what ends up happening is that you don't align incentives correctly to bring the right kind of people to support your business.

[00:49:18] Nitin: So most of these tokens are, I mean, 95% of them will go to zero. It's a matter of when, not if. And one of the reasons is that you don't have a high enough overlap between people who hold these tokens and people who are using your product. So there's too much speculative activity. There's too many people, both on the retail and the investor side, who are not actually believing and participating and building this in the right way.

[00:49:46] Nitin: And the community part becomes very, very noisy, et cetera. Right. So What I find interesting is that ONDC, on the other hand, at least think of India as a starting point. It may not have these [00:50:00] behavioral challenges. It may have other challenges, but it will not have this behavior change challenge. It will have more of a, ease of use challenge and perhaps some kind of top down push, from large companies coming on or the government doing something more or folks like Nandan and the ONDC team, you know, with so much experience and impact that they've created.

[00:50:23] Nitin: Being involved may be a catalyst to get it started. And if it doesn't have the same behavioral challenges, speculative, all of those aspects, then, then this one has some positives to maybe realize value sooner. that doesn't mean that I'm writing off Web3. I continue to be a big believer. I just think the funding mechanism and the community mechanism is not correctly working right now.

[00:50:46] Nitin: And it's too much noise and too much irresponsible scamming of people that has been happening. But I think both these top down, Web3 is more bottom up, ONDC is a bit more top down. I think both [00:51:00] these are very important experiments, you know, and I think every, every kind of experiment should be encouraged.

[00:51:07] Rahul: Yeah. Yeah. The one challenge I see with ONDC is that people associate a particular place that they shop at with someone, some sort of brand, right? So you, you purchase from Amazon because you have some sort of a trust in them. With ONDC that goes away, right? So then it's very difficult for. To get people

[00:51:29] Nitin: No, it doesn't, Rahul. I mean, we'll see how this evolves, right? But the theoretical or the conceptual answer right now is that you will have buyer apps, you will have seller apps, and you will have infrastructure connecting the two, which is called TSP, Technology Service Providers. And that, those may be in logistics and reconciliation of payments and...

[00:51:47] Nitin: So on, so forth. A lot of the glue in between. Now, existing brands could still be, very, very likely powerful buyer apps because they have the [00:52:00] distribution and the user awareness brand and all of that. So I don't see that changing. You may, you may still be shopping in the same, on the same, with the same party and not realize that they are now a buyer app on top of ONDC.

[00:52:15] Nitin: But, you know, the argument is that right now an e commerce player has built every part of that infrastructure in India, full stack, from the demand side to the supply side, the logistics, payments, fulfillment, all of this has been built by them. And that is formidable with Amazon and Flipkart's investments.

[00:52:34] Nitin: But there are, but today, you know, we are still in the very early days of it, right? I don't know the exact number. Borderline, I think it's something like you could look at India's urban businesses, small businesses, right? And I suppose 70% plus of them have a QR code today.

[00:52:51] Nitin: So they are accepting digital payments with UPI, et cetera, but only 7% of them have sold something online.[00:53:00]

[00:53:00] Nitin: So there is a big gap where between digital payments and digital commerce. The seven and 70, right? So which means that even though the awareness of digital payments and e commerce is very high, you have a lot of categories where people haven't come on online. Some of it is hyperlocal. Some of it is complex commerce.

[00:53:18] Nitin: Some of it is categories like, like paints. Do you buy paints on Amazon? You don't. Right? So, so, so there are certain categories which haven't come online and there are some complex cases which haven't been solved by e commerce. And, there are also some B2B cases which haven't been solved yet, and O N D C provides an interesting template to experiment around all these things.

[00:53:41] Nitin: And, and maybe I look at it as a market expansion story rather than competition. Right. can we take that seven to 70 and have every category of commerce possible be online, wherever it makes sense. So, you know, a lot of questions and things to be worked out right now, but we are, [00:54:00] we think that it's. A very, very interesting framework.

[00:54:04] Nitin: And, we would love to see more and more founders build companies here.

[00:54:08] Rahul: yeah, yeah, one last question, where do you see Antler, India specifically, uh, in let's say 10

[00:54:16] Nitin: Rajiv and I, would like, um, to believe that, you know, we can play a meaningful role in. Being that first layer, when people start companies, we want to be that place where people think of when they are beginning to think about a venture, you know, we would like to believe that, we in 10 years, you know, fully have had the creation of thousands of startups, because, you know, a lot of startups get created in our programs.

[00:54:46] Nitin: It doesn't mean that everything gets funded by us or by anyone else, but it's still. A great thing to know that we are helping people start companies and form teams and all that. So I think we, we expect, um, I don't, I don't have [00:55:00] any master plan to share with you of numbers, but I would like to believe that we will have a very national presence.

[00:55:05] Nitin: We will have a impact across the country and many, many more people, you know, thousands of ventures hopefully getting started and hundreds getting funded by us. And, and then finally, also that we build a very powerful way to connect Indian founders into a very global network so that on day one, if you're starting a company in mental health or, digital public goods or, AI or web three, you know, that you are immediately accessing 20 other founders who are building something similar in other markets and you're building your community online and offline.

[00:55:42] Nitin: So that you start with a very powerful family and you are also hopefully finding through our platform your first customers.

[00:55:51] Rahul: If we can deliver this kind of value, I think it becomes a very, very powerful way for founders to jump from that minus one to zero and zero to one.[00:56:00] and then we hopefully will continue to support them for many more years in their journey.

[00:56:05] Nitin: It would be nice to also, you know, look in 10 years, be able to say that we've democratized entrepreneurship for certain types of founders who don't get fun, who haven't historically, been catered to in a specific way. So it could be college students could be, you know, we'd like to see more women founders, many, many more.

[00:56:23] Nitin: And we'd like to see more people from smaller cities also apply and get funded.

[00:56:29] Rahul: Yeah. This was wonderful, Nitin. Thank you so much again for taking the time to do this.

[00:56:36] Nitin: Absolutely. Likewise. Thank you. Rahul really enjoyed the chat.