From both sides of the table: Kunal Bahl unplugged
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TARUN DAVDA
MANAGING DIRECTOR

Tarun is an intrapreneur turned VC who has had the unique opportunity to build and lead two successful Internet businesses in India.

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15th Mar, 2021

In today’s episode we have Tarun Davda Managing Director at Matrix Partners India, with Kunal Bahl, co-founder of Snapdeal and Titan Capital. Through the course of this conversation we cover Kunal’s early childhood and background that helped him shaped him into who he is today. The biggest learnings from his journey at Snapdeal, transitioning from an entrepreneur to an investor.

Salonie:

Hi and welcome to Matrix Moments, this is Salonie and todays episode is an audio recording from ClubHouse, where Tarun Davda Managing Director at Matrix Partners India, recently did a session with Kunal Bahl, co-founder of Snapdeal and Titan Capital. Through the course of this conversation we cover Kunal’s early childhood and background that helped him shaped him into who he is today. The biggest learnings from his journey at Snapdeal, transitioning from an entrepreneur to an investor and what that was like for him, life outside the startup and VC ecosystem and much more, Tune- in.

 Tarun:

Firstly, everyone who’s joined in, thank you so much really appreciate you guys doing this. This is the first time I’m doing this on Clubhouse myself, if there are any glitches apologies in advance. This is Tarun from Matrix for those who don’t know me. We’re an early stage VC in India. Today’s conversation is actually a part of our podcast series, Matrix Moments. Some of you would be aware of those. Now we normally do this offline and then we put this up on our website and I’m told apparently that that’s not cool anymore and so we’re trying to do this on Clubhouse for the first time. Joining us for today’s talk is obviously someone who needs no introduction. Kunal is one of the founders that I met very early on in my sort of career in startups and VC. He’s been obviously someone I have a lot of respect for, he’s taught me a lot just kind of observing him from a distance. So, Kunal, thank you so much for being here. Kunal is the founder and CEO at Snapdeal and also the cofounder of Titan Capital. We’ll also talk about Kunal’s journey from entrepreneur to being an angel investor and sort of everything in between. Thanks for joining us on Clubhouse now.

Kunal:

Thanks, Tarun. It’s always a pleasure. You’ve been such a dear friend for – I think we’re all belonging to the – soon belonging to the geriatric society of Indian startups. But I think let’s enjoy our youth while we can, it’s a pleasure being here and thanks for having me.

Tarun:

Great. And I just want to thank again everyone else who’s joined in. Obviously if you have questions, please just raise your hand and we’ll try and get to those towards the end of the chat. So, Kunal, I’m going to start with a little bit of a trick question which wasn’t something I had initially planned. But do you remember how and when we first met?

Kunal:

I think we met in Trident, Mumbai, maybe almost ten years ago or maybe a little bit more than ten years ago. And you were at BigRock then and that conversation then led to you joining Step Out as a co-founder and then that led to you joining Matrix.

Tarun:

Yes. Absolutely. And I think had events unfolded a different way I potentially could have been part of Snapdeal as well. So that’s always I count that as a missed opportunity for me but just for the audience, you know, I was preparing notes for this chat today and I was like, hey, let me go back to how do I actually know Kunal and for those of you listening in I remember Kunal had --- I can’t remember Kunal that was your Series A or Series B but was this massive round and you had actually written to me on LinkedIn and at that time I had no idea how this works, I was at BigRock with my blinders on building stuff. I can’t remember for sure but either we got introduced by someone or I think you wrote to me on LinkedIn saying hey, I’m in Bombay, let’s catch up for coffee and I think we met at the Trident. We spoke about me sort of wanting to stay in Bombay for a while and you said, hey, if you have a change of mind let me know and we might have something for you at Snapdeal. And incidentally after that while I was talking to Step Out to move there I think the founder of Step Out this is Adam Saks, he was talking to you as well and incidentally we both were talking to you without knowing the other party is also talking to you while we were sort of doing the negotiation. So that was one funny incident.

Kunal:

Indeed. Now it’s been so long but yet I still remember the couch you and I were sitting on in the area of Trident, Mumbai where they don’t offer you coffee. You can do a free meeting there.

Tarun:

Yes.

Kunal:

So, yeah, I do remember.

Tarun:

Yes, absolutely. So I’m going to start with I guess the first part of where I really want to spend time and this is for all the young entrepreneurs here, all the people that count you as a role model. And so I will start with --

Kunal:

I see Deepak who’s not so young entrepreneur also.

Tarun:

Yes. Deepak. I see Deepak, I see Miten, I see Kuldip, I see a bunch of folks here. So, guys, thank you again for joining in. I’m going to start with the first question, what kind of a child were you? How would you describe yourself as a child?

Kunal:

Yeah, I was like a super mischievous child and I never used to like to study and I grew up in a household where there was so much emphasis on studying and doing well in academics and my brother was really brilliant in academics, my elder brother. And so there was always this push to study hard and all I wanted to do was play. I remember when my mom used to go to the market I used to run to her room and switch on the TV and start watching TV, the two channels that used to be early those days. And I would run back to the room when I would hear the gate open and she’s my mom after all so she would touch the side of the TV and she would know if it was warm and she knew I had been naughty. So I think that was a bit of my childhood, just I think in general I had like these two parts to me, one was this mischievous, always up to no good and the other part was it was a bit forced to be honest, which is keep studying, marks are important, doing something with your life is important.

Tarun:

Interesting. And were there any I guess early role models or mentors like that played an instrumental role in you becoming an entrepreneur or moving towards entrepreneurship?

Kunal:

Yeah, I didn’t know of entrepreneurship, but I think more as a person – obviously all our parents play a big role. Right, so one can’t take that away from them that credit goes to them. But specifically in my life I think growing up my grandfather played a very instrumental role. He was in the defense services, very disciplined, everything was always on time with him. He was incredibly charismatic person that people would come and just listen to him, he was very, very inspirational. He had a very inspirational life – I feel that if he were alive today in social media currency, he would be the person who would have millions of followers. Just purely owed to his brilliance and charisma and people wanting to hear his thoughts on life but I think he played a very instrumental role I think most importantly inculcating the important of discipline in life, being on time for things, not keeping people waiting. You know, just being a good listener, basic stuff I think, somewhere just spending my summer vacations with him played a big role in ingraining some of those things. I don’t know how much I adhere to them, I feel I do, but I think those are the things I vividly remember having picked up from him.

Tarun:

Interesting. And can you talk about maybe one or two early experiences that have helped shape you into the person you are today, anything that comes to mind. You know, all of us have this one or two sort of you know, turning points which obviously when we go through then we don’t realize as a child that was a turning point in our life. But any such incident comes to mind?

Kunal:

Yeah, I think there are many but I think one that – while I would say I would like to believe that the trendline of my life has hopefully been in the upward direction for the past 35 odd years. But to be honest looking back I only remember the times when I fell or I failed, you know, sometimes quite miserably unfortunately. You know, my brother went to IIT and then to IIM so in my house it was assumed that he will go to IIT. And it wasn’t even a choice like I remember I wailed and cried that I didn’t want to do IIT engineering, science, I want to do commerce but it wasn’t a decision that was mine. So I had to go do the whole science and IIT thing and spend two, three years of my life trying to get into IIT and studied very hard, made all the sacrifices like no girlfriends, no parties, nothing. Like 11, 12 and maybe half of class 10th I was only studying for IIT. And I remember – and everyone thought like I remember my brother used to tell his friends and my brother was already at IIT and he would tell his friends that my brother will join next year. It was almost assumed that he will like there was no pressure at all. And then I remember everyone thought I’d get in, like I think there was sort of like okay, he’s not that dumb, he should get in. And I remember that was the first year, 2001 was the first year when the results were coming online for the JEE exam and I was at the screen and pressing refresh and it was obviously not loading because there was so much traffic, it was like..

Tarun:

Oh, God, those days I remember.

Kunal:

Yeah, dial up connection. So and then visualize my entire family standing behind me including my dog waiting for the result to come and then finally the result came, under my application ID number it said ‘no rank’ which meant that I was not even good enough to get some rank in the thousands and I think I turned around and everyone had sort of vanished because everyone was so despondent. I remember I just went and played cricket for like two, three hours that day. You know, around those times it’s crazy because it was almost as though someone had died in the house, someone had passed away. Like my aunts would come over, spend time with my parents, etcetra. I remember one mean one came and said, humein tou pata he tha iska nahe hoga. So I think it was – society sometimes has a way of really kicking around those who have fallen but I think at that for some reason I mustered the courage like in order to just get up, brush off the mud, insulate myself from what the world was saying, just keep going. Just slow down and don’t look left, right, up, down, just keep moving forward. And I figured out what I wanted to do next, I was done with doing what others wanted me to do and I was pursuing what I felt I wanted to do. I figured out a good college that I wanted to go to which had a good program. You know, worked hard, no one in my extended family had ever given SATs to get into the US. No one in my family had ever set foot in the US like my parents, my brother, no one had even went to the US let alone to study. And I got into the college I wanted, literally you know, by it’s quite a bizarre experience showing up with two suitcases and never having spoken with a non Indian person ever in my life till I landed on my campus. And for a 18 year old it was quite a surreal experience, then doing three jobs to pay my way through, having the sense of part responsibility, part guilt that my parents are putting a hundred percent of their savings into my college education. I was applying for my college and they wanted some source of financial proof or proof of financial source. I recall photocopying my mom’s like Indhira Vikas Patra these are these things you buy from the Post Office, it’s almost like a FD equivalent. We were like we’ll send them lots of photocopies of IVPs they must be wondering what they were. But I think just going through that whole one year where this sort of like you have failed at it at the ripe old age of 17-18 to then finding my way through going to a completely foreign land, how to proceed there as a very shy boy. I was very, very shy, very introverted. And then getting exposed to such incredibly smart people, amazing professors, exposing to entrepreneurs who had done great things, I think that was truly transformational for me. So I would say that that whole experience of start to finish was incredibly transformational. And even to this day I feel like nothing has likely been more transformational for me than that one year period.

Tarun:

Now I’m going to take a little bit of a digression but I want to share this because it’s a video I saw couple of days ago there’s this entrepreneur called Sara Blakely, she runs this B2C consumer brand called Spanx. And I was watching her video and she recounted this experience which I thought was amazing. And she talked about when she was a child every night or whatever – once a week, or whenever it was on the dinner table her dad would ask her what did you fail at this week. And basically she’d say whatever, you know, I didn’t do well in my chemistry exam, I didn’t make it to my class team for whatever soccer or whatever it was. And every time she’d say that her dad would give her a hi five. And basically she didn’t realize it back then but it was his way of kind of telling her that hey, you know what, it’s okay to not sort of succeed at everything you try but it shouldn’t sort of demotivate you from continually trying new things. And it kind of builds character, builds strength, builds confidence and stuff like that. So I thought that was like a really, really interesting thing and I think something that you said about your experience where you didn’t get into IIT in your attempt but eventually you picked yourself up and there were better things waiting for you.

Kunal:

Yeah, I know that’s a great story about Sara Blakely also.

Tarun:

Okay, I’m going to maybe just shift gears, I know we have 45 minutes more so I’m going to try and hit upon as much as I can. I’m going to move towards the Snapdeal journey. So can you talk about I guess what was the first taste of success for you at Snapdeal and what did it teach you?

Kunal:

Yeah, so I think you may be expecting that I will talk about the first fundraise we did or the first sales milestone we hit. It’s actually neither and I’ll maybe rewind back time a little bit to pre Snapdeal days because I think you know, probably the most vivid memory of that particular moment probably was a few years before. You know, we had started the company as a coupon book business where we were selling physical coupon books. It was called Moneysaver and it was just the two of us, Rohit and I, and we were essentially running around Delhi talking to restaurants, spas, salons. We were sitting outside for hours – these are restaurants where they would welcome us as guests probably but the moment we wanted something from the restaurant manager he’d say you go sit outside and sit I’ll come. And so we’d wait for two hours, three hours, sometimes at receptions of offices and these retail outlets just to get the attention of the business owner. And this was the time when nothing, whatever we were doing was not called a startup, right, like startup was not part of people’s dictionary. I would say conversely there seemed to be an association of adverse selection with those who were not doing a job back in 2007. Like these guys may not have gotten a job that’s why they’re doing this whatever thing they’re doing, the coupon books etcetra. And it took us nearly two years of just like slumming the streets of Delhi like in hot weather wearing coats so that we would look – we were 23, we would look older, like we were doing every possible hustle we could just to get this coupon book out because we had such deep belief that this is going to work. Indians love deals, Indians love coupon, Indian consumers, and we just had to get it out. Like anything to get it out let’s just get it out and it will work, we were totally convinced. And I remember we just finding a printer who would print it because we wanted to have security features so that people don’t photocopy the coupons and resell them. We wanted to be very particular about which colors so only one printer in somewhere in Noida who had the machinery to print this coupon book. And but he said I’m so busy I’m printing all kinds of holograms for the government and like my security press is super busy, the only time I can print your coupon book is like at night when I have a maybe a low period when all my primary print jobs are done during the day. And so I recall like I had for many days I would just go to Noida which was very far from where our office was and just literally sleep on the shop floor of that printer, sit with his designer till like 4 am and then they would print a test run, then we would design some more, then we would print a test run, literally just eating Dominos and sleeping there. Like defining how many GSM the cover should be versus the inside pages, like every possible detail was being obsessed over for weeks because we were so convinced this would work. And I remember finally the first print when happened this was maybe at 4:30 am one day and there the manager there said here finally are you happy. And I had like a pretty stoic face, pretty straight face, I was smiling and all that and I remember I used to drive around a Zen that belonged to my grandfather, a light blue Zen I used to drive that around and I just went outside the factory, sat inside the Zen, it was dark outside and I remember I just screamed out loud with happiness. And I recall like tears came down my face and I was all alone in the car but I was very, very happy. And I think I just had never in my life until that point in time created anything, this was actually the first time. I had studied a lot, I had gotten a good education, I’d worked at Microsoft for a year but I had never really created anything which was once a thought and now something in my hand. And I think that just what Rohit and I had been able to create at that point in time that feeling of holding that in my hand it was like holding your baby, literally your baby. I think next time I experienced that feeling was December 31, 2015. But I think that was probably while it wasn’t success per se because that business, the product didn’t do well but at the same time it was success for what the objective was until that point in time.

Tarun:

No, I think it’s amazing. You know, I think while you’re right, I did expect you to talk about some funding round and something related to the business. It’s honestly as an entrepreneur it’s these small moments that you truly cherish once all the noise around fundraises and everything sort of dies down. So I’m glad you actually gave that example. Talking about I guess the converts, right, obviously you had your share of ups and downs. Can you talk a little bit about just personal experience with – or any down phase or any tough phase that you had navigating Snapdeal through a crisis, there was a time where people like sort of written the company off. You obviously a lot of us who knew you personally knew that if there’s one person who would steer it back into a position of strength it was you and Rohit obviously. But there was lot of disbelievers as well, right, can you talk a little bit about just what did you go through mentally or emotionally while you were going through that crisis, how did you bounce back, how does that I guess change your view on entrepreneurship and sort of running companies?

Kunal:

I think while there seems to have been a lot of focus and reportage on the period we went through as a company in 2017 it wasn’t the first and I hate to admit it but likely not the last crisis we will see in our lives. And so, you know, I feel that how one deals with crisis is likely not very different, it’s just what is different is the scale of the crisis. Right, if you learn how to deal with problems, issues, how you get past that moment where you skip a heartbeat, where you get past the moment where you practically can’t breathe because the news is that bad once you have experienced it a few times in life you learn how to get past it.

Tarun:

Does it get easier?

Kunal:

Yeah, it’s not easy but I would say, -- it does get easier I would say.

Tarun:

I guess your ability to deal with it becomes ---

Kunal:

Yeah, absolutely. I think it does. You know, I think what I must add here is that I don’t think getting past any tough phase – it’s not like you can read some book and get past it. Oftentimes it involves breaking the problem, first taking a really deep breath and saying that look, okay, we’ll get past this, let’s just break this problem into smaller parts. Let’s talk it out, let’s discuss it out that what is it that we can do, what is it that we cannot do. And I think you realize in hindsight that the role that your team plays in helping the company or yourselves get out of a situation that is challenging is the most critical thing. And I think unless you have the right team in place, a team that believes in you, believes in the business, believes in the fact that why we’re here is not because of something wrong that we did etcetra but it’s just an amalgamation of various circumstances -- but we can get past this. So I think that is something that I’ve realized that at every point in time whenever we’ve had a tough period what I have done is over index on communicating with the team. Because oftentimes folks think that the team needs the communication from the founder, right, which is true because somehow the founder or the founders are the source of the energy for the team. I think of it exactly the opposite, for me the source of energy in times that are tough is completely -- is actually the team itself. So I remember in any tough phases, I think 2013 we were down to one month of money, 2017 a well-documented period -- so less said the better. 2008 we were down to one month of money, so we’ve seen so many ups and downs, like what I often -- I was telling someone the other day that sometimes I look back and feel that I must be in a movie that a really mischievous writer has written that it’s like a rollercoaster all throughout like not necessarily bad only but there have been many, many good things about it and I’m very thankful and blessed for it. But I sometimes actually genuinely feel I’m inside a movie that someone else has written the script of given the kind of twists and turns we’ve seen along the way. But I would argue to your point, Tarun, about how to get past these tough periods I would say the strength and the trust that co-founders have amongst each other I don’t think any of the tough phases we would have gone through I could have gone through without Rohit by my side and likely vice versa. I don’t think we would have gotten past any of those if we didn’t have a good great team that we believed in and that believed in us at the same time irrespective of whatever the world may be saying. I would say these two things are everything, if you have these two you have a great partner, and you have a great set of folks who trust you and who you trust you can pretty much get past anything. I think you can be truly free with them and completely open up and invite them into this vulnerable space that you find yourself in. And I think now we’ve gone through enough that for us it doesn’t seem like an unusual thing to do and those who’ve worked with us for many years also know that.

Tarun:

Yeah, you know, I think that’s such a lovely point you made which is I think as investors we sometimes are privy to obviously a lot of companies which go through their ups and downs and what really separates I guess the ones that are able to navigate their situation is just a lot of the stuff that you said just kind of rings home, right, which is I’ve seen unfortunately those times that’s when the co-founder relationship really gets tested. Right, before that it’s a marriage of convenience, you know, people when things are going well obviously everyone’s happy but it’s only in these tough times that relationship is really tested and honestly unfortunately that’s the first time most I guess co-founder relationships that don’t work that’s the first time they really know that I guess the value system is different. So, it’s actually a blessing like you said to have somebody who sort of sticks to the tough time, is able to sort of give you strength and vice versa.

Kunal:

Yeah, absolutely.

Tarun:

So every founder has their unique style, right, and I’ll tell you where this question is coming from. I was talking to – well, I can say his name, I was with Kunal Shah a couple of weeks ago in Bangalore and he and I got talking and he mentioned about some uncommon sort of things that he’s doing at CRED, right, which is whatever ten percent use of pool, non-dilutive, always stays that way, he wants to share wealth with sort of employees and a bunch of other stuff. If you take Bhavin at Directi, he’s obviously done you know, extremely well for himself. I remember when we were there together back in like this was like 2009-10 the kind of stuff, he did back then is still stuff of legend even today which is literally opening up the entire organization’s salaries to everybody else. Anyone going and deciding their own salary and then as long as you’re able to justify that to everybody around you, well, you’re fine. Right, then it was some really crazy stuff that he used to try out. Just for the I guess young founders on this call or I guess even the experienced founders, can you maybe point to a couple of things that you think have helped kind of a are uncommon and b are kind of helped shape the culture at Snapdeal?

Kunal:

Yeah, I think I would argue it’s the transparency. You know, I think while a lot of the things that you mentioned are quite impressive and we’ve tried to do our version of them through the years whatever they may be but obviously not a contest. But I think for me the number one thing is actually transparency and it’s obviously a fine line, right, because it’s not super straightforward, it’s very hard to be able to share absolutely everything in the grainiest detail with everyone in the company for a variety of obvious reasons. However at least I have seen over the last many, many years over the last decade that the thing that team members really care about is actually transparency. Like they want to be told the good news when there is good news, they need to be told the bad news for sure before they find out from someone else. And if someone is talking about giving bad news about the company whether it’s true or not it’s important to address it very, very quickly and lay out what the reality is for the team. So for me I think the number one thing I always ask myself is what how can we push the envelope of transparency without being even more. Like for instance we do monthly townhalls where we share very transparently how the company did last month. Right, whether it did well, whether it missed its goals, whether it exceeded its goals or celebrating good achievements and also calling out where we have fallen behind. And at the same time keeping our doors -- we don’t have cabins in our office – but like being always available if anyone wants to talk to you irrespective of what role they do at what level in the company. I’ve realized that over a long period of time most folks may not know that but the average tenure of a team member at Snapdeal is over five years and this is despite the company having gone through its very well-known ups and downs. But I think why people have stuck with us, stuck with the company over this period of time is because they know that we’ll call a spade a spade, internally for sure we’ll call a spade a spade. And they will get the real deal from us always, so that’s – if there is one thing, we’ve always over indexed on is transparency.

Tarun:

Kunal, can you make it a bit more real, again I guess when you say transparency is there any one incident where it was extremely I guess inconvenient and uncomfortable for you all to be transparent with the team.

Kunal:

Oh, yeah, absolutely.

Tarun:

Can you share, just to make it more real for everyone.

Kunal:

Yeah, in 2017 when we were going through that really treacherous period for the company where every day oftentimes a lot of inaccurate reporting was happening about the company because there was just like it became like a one-upmanship period even for the press I would say. And so, I don’t kind of blame them, I think everyone felt that they had to say something just to attract the eyeballs and the clicks and they could not say something – they could not sit it out. And that I can tell you is an incredibly harrowing experience obviously for the founders but it’s incredibly harrowing, even more harrowing, for the team members because they don’t even know half the things or most of the things that are actually happening in these boardrooms etcetra. So they’re just guessing and reacting to conjecture – so after finally we decided to go on our independent path we decided as a board as a founding team, leadership team, that we want to just continue building our business and first thing we did was just like get everyone in the room and lay it out very, very clearly to them that what our insecurities are of taking this path, how much money we have left, what all will need to be – here are the 25 things that would need to get done for us to come out of this rut as a company. And one could argue that hey, people are anyway so spooked why are you giving them more reason to be spooked. But this was not a time when you could conceal what needed to be told because first and foremost we needed to have their trust where the team needed to feel that these guys are being fully transparent with us about what they’re also worried about so that we can all then put our heads together to solve it. And I feel that in all of those meetings we did dozens and dozens and dozens of those meetings around this July-August period 2017, everyone came in with long faces to these meetings but I think they left with a twinkle in their eye. They left with, okay, it’s not all so bad. Right, like we kind of know what’s the really bad parts, what are the really, really, bad parts and what are the fairly resolvable parts, so let’s compartmentalize these. I think it just kicks people into motion and takes this malignancy away from the culture just being acutely transparent with what the circumstances are.

Tarun:

No, my experience is unfortunately sometimes when you withhold information I think you’re doing two things, right, one is obviously people tend to assume the worst and if they don’t know what the situation is obviously they’re going to take what’s out there and sort of imagine it 10x and say hey, this is likely way worse than what is being written about and I think if you share that openly and transparently obviously at least people know what the accurate situation is, right. Second is I think people like to be I guess sort of in the know and I have found that most people – I’ve been surprised when we’ve seen some of our companies take tough decisions and obviously some companies have managed it better than others, but the ones that truly treat the entire company and every employee as a family and as a family I mean if you’re going through a crisis you talk about it, right, you talk about it openly. You say, hey, here’s what we’re going through, here’s what we need to do, here’s where you can help. And I think companies that have done that communication and sort of got people into the inner circle have been surprised by how people have risen to the occasion.

Kunal:

Yeah, absolutely.

Tarun:

Okay, moving to the next one I guess I’m going to make a real switch and move towards your journey as an angel investor and you’ve done exceedingly well and I think I can see there’s a few people on this call that have had the good fortune of having you as an angel in their company and there’s several outside of this call as well. But what do you look for in founders – you’ve obviously like I said I think you’ve picked some of the best ones over the recent past. So what is it that you look for?

Kunal:

Yeah, I think you’re very kind to me on this one given I’m just a part timer in this side of the fence.

Tarun:

You do extremely well at it being a part timer.

Kunal:

Maybe that’s the trick. Just pay little attention, don’t overthink.

Tarun:

Don’t take more time of it.

Kunal:

Yeah. So, look, at the earliest stages of the business there are very few things to go by to assess the business. Right, there’s rarely like one metric that will get us to commit but businesses that tend to lack focus on a single very sharply defined problem statement tend to be tough for us to wrap our heads around. You know, all the stuff we’ve learned from experience as the saying goes, you know, good judgment comes from experience and experience comes from bad judgment. So we’ve made enough bad judgments through the years of our own that we’ve realized that what good judgment looks like and good judgment at least in the early stages and maybe even later equals focus. You know, broadly we’ve invested in many companies, we’ve invested now I think last count is almost 175 companies mostly in India but many in the US, many in South East Asia now. And these scan across like B2C, B2B, marketplaces, direct to consumer, fintech, computer vision, stuff I would argue I don’t even know much about or know nothing about. But I think most businesses can really be distilled down to like some basic questions that you can ask -- but that comes later I think and most important thing is the team. What have they really achieved in their personal or academic or entrepreneurial or professional lives that can one point to success that they may have had in creating impact particularly in unstructured or blank slate environments. Can they inspire people around them, you know, having we’ve interviewed thousands of people to hire them over the years, met hundreds or if not thousands of entrepreneurs over the years I feel that if an entrepreneur can inspire me about his business they likely, you know, and I’m someone who may – I’ve seen so many that one could argue you may be pretty fatigued at this point just meeting founders. But I’m not but like it’s a fair assertion to make but if they can inspire me so much that I want to let just jump out into the screen and hug the guy then they can likely mesmerize many others to join hands with them in their journey. And I think the team is sort of very critical, the second I would say is just the attractiveness of the space that they’re going after. That’s obviously very tough because in the early stages most spaces are non obvious, I remember when we did the seed round in Ola like almost ten years ago I mean there was like Kaali Peeli taxis no one believed, they were doing intercity not intracity. No one believed his business would work. When we did the early first round in Urban Company nobody thought that you could ever make money in India by employing plumbers and electricians, right. So when we invested in Mamaearth nobody thought that a business like selling mosquito repellents for kids could ever become large. So I think most of these were fairly non obvious in the early days, however the best entrepreneurs tend to be great at helping early stage investors gaze into a crystal ball with them and make them dream with them that what can this business become when it grows up. The third is just from our own experience and battle scars just the ability to generate unit economics, right, many businesses that we would look at are pre revenue but it is important to determine what the unit economics look like as the business would grow up. The margin structures of a business actually determine the soul of the business, right, it determines whether it is a squirrel with a tail or elephant with a trunk because it’s tough to go from a 10 percent margin business to a 50 percent margin business and still be in the same business. You know, they both may be great businesses but they’re different businesses there. And understanding how the entrepreneur thinks and values and invests their time and bandwidth in building the right unit economics in the business really those choices determine what this business will become once it grows up. And, look, the chances of building a lasting enduring company will only come if there’s a clear path of being completely self-reliant, I think everyone is talking about this now these days but this wasn’t the case as we know up till a few years ago. So, I would say in summary it’s just the team, the size of the opportunity, the ability to generate economics I would say the team is like 80 percent of what we would look at.

Tarun:

So I’m going to give one small anecdote again because again it’s something that honestly I see as a highlight of my investing career but – and I have you to thank for it. I remember this was in 2012 and I was spending time with Bhavish at Ola and I remember calling me for a reference call about Bhavish. And I think there was one line you said which kind of sealed the deal at least for me and after like asking you like 20 different questions in different ways about hey, what is he good at, blah, blah, blah and all these things.

Kunal:

I was getting a headache by the way. I was just being polite.

Tarun:

I remember one line you said, and you said I see a little bit of myself in him. Right, and I think honestly that gave me a lot of confidence and obviously we ended up investing in Bhavish and Ola and it’s a well-known story today. But tell me, you know, when you say I see a little bit of myself --

Kunal:

I think I would just say now I should be saying, you know, I hope he sees a little bit of me in him.

Tarun:

No, no, you’re being too humble. No, but so you said team, right, and again this is something that obviously I spend my entire day thinking about you meet a lot of entrepreneurs. What are the common characteristics like if you were to – like unit economics, business model, obviously a lot of these are hard to see at the early stages, right, especially where you and I invest. But if you have seen any common patterns amongst the founders that have gone on to do well, right, or have gone on to build a really large company. Can you maybe pinpoint like two, three things again?

Kunal:

Yeah, absolutely. I think the first and foremost is what I referred to earlier, focus. And I think sometimes focus is mistaken or misunderstood. Focus is not about doing less but rather doing more of what matters the most. You know, sometimes focus seems like this unexciting thing, it’s not. You can do tremendously exciting things but within very well-defined guardrails, this is something I had no clue about when we were building our business in the early days. Right, I had no idea like what the virtues of focus are. I think since our youngest earliest memories as kids I remember whenever I used to be my naughty self my mom used to always say, beta focus karo, I think I never understood the meaning, I think only after a lot of experience, trial, errors, mistakes, burning my hands, it’s only after that I truly understood the value of focus and I’ve seen that obviously the eco system has matured and many smart entrepreneurs have learnt from the lessons folks like us learnt and mistakes we made. That most of them are now very, very focused from the get-go but whenever they would deviate I think we’re there to help them, that’s our role as mentors in some ways. I think that’s one. The second thing is the extremely, extremely obsessed with customer experience -- whether it’s a B2B customer or B2C customer, to a fairly extreme degree. And that is one realizes that in any business that has to come from the founder, that obsession for experience has to come from the founder. The moment you are okay with a bad experience, sub optimal experience as a founder you set a new low bar in the company because everyone will now feel that that’s the bar that they need to watch out for rather I think I’ve seen the best founders tend to keep raising the bar on experience. Again this is a lesson we’ve learnt the hard way because early days of e-commerce was so chaotic just convincing sellers to come onboard, convincing customers to come onboard, there were discounts flying around, coupons flying around, products flying around. You know, in some cases mangoes and stones flying around in packages that it was very hard to just focus on doing all the things you could do for customer experience not because we didn’t want to but we just didn’t understand all that we could do. And it took a while for us to get our heads around to that. But I would say that the brightest entrepreneurs these days have that as a core tenet in whatever they do. Thirdly I feel particular to pretty much any possible type of founders, any possible type of business not particular to any kind of business is the ability to just attract fantastic talent. Right, often talent that’s more experienced than them, maybe even more professionally accomplished than them. And that is super critical, without that you just can’t move forward, and I think that’s held true. That is one thing I would say from the early days we’ve done okay. That from the earliest days somehow Rohit and I have been able to attract really the best and the brightest to come work with us and build whatever we’re building together with us. But these three attributes would be likely the things that I’ve seen the most focus, then obsession about customer experience and third is the ability to attract fantastic talent early on.

Tarun:

You being an investor and sort of seeing things a little bit from a distance I guess has that in any way sort of changed how you run Snapdeal?

Kunal:

Yeah, I think in many ways it has. I feel that when you talk to these really incredible founders, I see many of them are here in the chat today and thanks for the support, guys, but I think I’ve learnt so much from them. Like I would have learnt like Bhavish is an incredibly ambitious and aggressive entrepreneur as a go getter I learnt that from him. From Abhiraj I learnt he’s really incredible with people, really incredible with obsession with experience which comes out in their service, I learnt that from him. Even amongst the younger entrepreneurs I see Anirudh’s here from Pepper, I saw him a short while back, and here the speed at which he moves, the ambition that he has running through his bloodstream is so inspiring for me. I think every entrepreneur inspires me to be a better version of myself professionally, personally, in their own small or big way and likely unknown to them. And I think investing has also helped both Rohit and I to stay intellectually relevant so that as we get older, we don’t become like these old fogies who just don’t know how to compete in today’s world. So I think it does keep us intellectually relevant and also in ensures that monopoly doesn’t settle in our own lives because keeping that energy level high is super critical when you’re in this long marathon.

Tarun:

Absolutely. So I’m going to ask you a question which I think Indian VCs get a lot of brickbat or lot of criticism saying we aren’t sort of – we don’t take enough risk, we don’t invest in true moon shots and it’s partially true, right, you know, give or take I think there are definitely things that all of us can do better. As an angel, as an entrepreneur and obviously as an ecosystem we’re still way younger than our sort of valiant and maybe China counterparts. So, what would you like if you had a – I mean again you’ve seen so many different fundraises of your own, you’ve seen it from a distance maybe with so many of your portfolio companies. Where do you think we need to sort of shift things to just make the ecosystem better for everyone?

Kunal:

I’ve a very simple answer, Tarun. Are you ready for it?

Tarun:

Yes.

Kunal:

Just fund more founders like Titan as an investor.

Tarun:

We’re correcting that mistake; you and I have chatted about that often. Seriously, so what should we do, I guess, what can we do to serve this ecosystem better?

Kunal:

I think I feel while brickbats will come I always I tell myself, I tell founders who would listen to me, even investors who are friends that fundamentally we can’t fear being wrong, right, people will judge us anyways. So I just don’t bother that much about what I could do, what I should do etcetra. I tend to just focus on what I believe is the right thing to do. I feel the great thing is we’re seeing almost every investor -- like all investors are friends of ours and many of them we’ve known for over a decade, everyone is doing well. Right, like if I look around, yeah, some may be doing a little better than others, but everyone is doing well. And I feel that while it’s a nice – it’s always this thing that entrepreneurs are talking about VCs etcetera behind their backs I think it’s a well-known fact I just don’t worry too much about it, I feel as long as you just keep funding Titan funded founders I think you’ll be fine.

Tarun:

Point noted. And I think that’s a chat we need to have of course, there are a bunch of them we really need to get into more. So, shifting gears I know we’re going to be running out of time so I’m just going to try and move with the rest of the questions a bit more quickly. You mentioned mentorship, right, as one of the things that we spoke about in the previous section. A lot of founders obviously are doing this for the first time, right, and some I have observed from personal experience, some who have really benefitted and for whatever reason others haven’t taken to it as naturally. What is your advice to young founders, is it important, is it critical, is it absolutely necessary for every founder to sort of setup one or two sort of strong mentor relationships?

Kunal:

Yeah, I think -- I always feel that a shoe that fits one pinches the other, right, so no one size will fit all. So I don’t think there is a truism that will apply to everyone. But I think mentorship is very important, when we were starting our company there was no concept of mentorship, there was no one we could go to for mentorship. Most of the VCs hadn’t built businesses, most of the VCs hadn’t seen businesses get built in their portfolios also because everyone was operating first funds which were 2007-2008. So everyone was sort of like grasping at straws at that point in time and as a result I feel that we made – we likely on hindsight made a lot more mistakes than we would have had we had good mentorship. The good thing is that the tribal knowledge in our ecosystem is now so incredibly rich and so easily accessible that if you’re a hard charging motivated smart entrepreneur going after big market you will find great mentors. Right, and they will hopefully guide you in the right direction and ensure that you don’t deviate from your path. Look, I think I feel that my kids have taught me how to be a good investor like for instance you can’t go tell a two year old – you can’t reason with a two year old that they need to go and sleep now. You have to make them realize that that’s the right thing to do. So oftentimes with entrepreneurs while they’re very mature they’re not a two-year-old obviously they’re very mature, they’re very smart, and they’re so convinced about what they feel is the right thing to do for the business. However, if you strongly believe as a mentor that that’s not the right thing to do it is your responsibility to make them realize that in a way that they will get it. And I do take that upon myself as a responsibility because investing in companies is not about just give some money and then sort of fill it, shut it, forget it. Investing in companies is about taking this responsibility that you’re now essentially the founder’s brother or whatever you want to call it like mentor, brother, well-wisher, partner, but all of those tags come with a great sense of responsibility alongside and I do take it very, very seriously. Like any entrepreneur if they call me most entrepreneurs would say I’m usually available in a matter of hours if not minutes and rarely days. Because I know that when they’re calling it is likely quite important and I may be the first person they may be calling but I may also be the person who’s word they may trust the most. And hence I see it as a really, really incredible – I see it with an incredibly important sense of responsibility that they’re imposing upon me. But I feel in a nutshell mentorship is now part of the course and I think every entrepreneur must seek out mentors. I wish, you know, I just want to, both Rohit and I, we just want to help founders. Like given there wasn’t much of an ecosystem as I said when we started now that there is an ecosystem I don’t think we can help everyone but at least my hope is that over the next ten years if I can help a thousand founders I think hopefully that will create needle moving experiences for the ecosystem.

Tarun:

Yeah. By the way, Kunal, I’ve got a couple of offline pings requesting if you can maybe stay back for a few minutes more for some audience questions. Will that be okay?

Kunal:

Yeah, yeah, sure. My wife is out for a dinner and my kids are sleeping so I’m good.

Tarun:

Nothing better to do on a Tuesday night anyway. So let me, -- so guys, I’m going to actually request a few people I can see, I’m just looking at the top of the screen, Deepak, Miten, Tarana, Samidha, Adil, Sumeet, there’s a bunch of you, Kuldip, Madhav, I see so many of you all. It would really be great if you all have any question, I guess just ping me offline I’ll add you to the speaker list and would love to make this more interactive. I want to just maybe wrap up with one or two final questions from my side and then we can try and take a few audience questions. Talk a little bit about I guess you spoke about how you’re so quickly available for founders. I’ve personally experienced that there’s rarely a day where I’ve reached out to you asking for a call and like you said if not in minutes it’s literally in hours that you would make sure you will make time for me and I can imagine how many other people you do that for. I’ve spoken to you about I guess my struggles with staying on top of e-mail and Whatsapp and all of us are inundated every day and you actually said something last time we spoke which kind of blew my mind and you said you know what, I actually don’t get so much e-mail and I actually don’t sort of feel the pressure to be constantly on and yet you’re doing what you’re doing and are probably more 10x more productive than most other people. So I want to spend maybe a couple of minutes in just if you can share a little bit of like just productivity hacks whatever you might term them, anything that you’ve sort of inculcated I’m sure you’ve iterated over it over a period of time. So what’s your productivity system?

Kunal:

You’re very kind, Tarun. You know, it’s only when you asked me that day when we were speaking maybe a month ago I mentioned it but I never thought about it. But I think I broadly just for the group I had told Tarun that day that outside of like reports like we have a lot of like – we check through reports around the business etcetra that come in and I look at them at a certain frequency but in terms of e-mails I probably get like maybe 40-50 e-mails a day max, like I don’t get more than that. That’s not an invitation to send more e-mails but I don’t get more than that. I think it’s a function of – we have a fantastic team at Snapdeal that ensures that Rohit and I while we’re very hands on entrepreneurs we’re not being unnecessarily exposed to every bit of the sausage making. Similarly we have a fantastic team at Titan, right, Bipin and others on his team are great. Like they shield me and Rohit from the complexity where our value add is the end decisioning. I don’t think before that our role is particularly important and so I think that for some reason maybe because I’m an inherently lazy person we setup structures in a way that I end up spending time on really only the important things and not get exposed to things that suck me in. And I think the second thing is I’m not saying others do this but I actually don’t waste any time. So I don’t do anything outside of the time I spend on Snapdeal, time I spend with founders through Titan and my immediate family and now I play football every day as I told you. So I actually don’t do anything else, now that may sound really boring and like he’s leading such an uninteresting life but this works for me, right, I need a fairly undistracted life that way. So on the three things that I really care about I spend an enormous amount of time. And so I think that’s on that and then finally I usually find time to do whatever I enjoy doing. So and which is why like I enjoy talking to you so whenever you’ll reach out I’ll look forward to the time and we’ll actually get on the call because I know we’ll talk about some interesting things, right, some interesting company, some interesting trend, I learn something really good. I sort of look forward to the things I would enjoy doing and that doesn’t seem like work to me which is why I’m happy to do it at any time of the day. Many times I talk to entrepreneurs post midnight, very often like I would be exchanging messages with founders at like 2 am if I’m up. So for me it’s not like boundaries are not very sharp and all my time is dedicated only to these three things.

Tarun:

Yeah. That’s super helpful. Okay, last question from my side and then I guess I will hand it over to a few people. I’ve by the way added some people on speaker, I’ll add probably a couple of more that have asked for questions but let me shoot one question and then I’ll hand it over.

Kunal:

Sure.

Tarun:

So, I guess when you and I spoke through the pandemic and you were talking about I guess new habits you’ve taken on and all of us have kind of somehow made some adjustments to our lifestyle especially in the last year. Can you talk about I guess anything that you’ve started doing that you find just helpful overall that helps you focus better, be more productive, maybe it’s a morning routine, maybe it’s taking up a sport, maybe it’s something else. But anything that you can share just a little bit more I guess personal side?

Kunal:

Yeah, sure. I think firstly one of the things that sort of helped a lot in my life is in general like eliminating attachments. So I think some people who know me well know that I lead a fairly ascetic like life. I mean you could argue that our ownership in companies are assets like but I don’t view them as such. I view them as a piece of paper that formalizes our relationship with the founder and if it works out it gives us fuel to back the next generation or next cohort of founders. I don’t think of it as an asset while I see why many others may think of it like that. But in general I lead a fairly asset like life, like I stay in a rented apartment, I’ve lived here for 5-6 years, before that I still lived with my parents. I drive the same car that I’ve driven for the last 7-8 years. I think that has helped, like my wife tells me all the time let’s buy a house and we’ll have some safety security businesses ka kya pata, you’ve seen ups and downs. So I get that lecture every month or so, you know, she tells me like what are you going to do with the paper of all these companies etcetra if you don’t have a house over us. So I think there is – but I feel somehow like just eliminating all these attachments and like leading the ascetic like life has actually helped me to be mentally quite sane and happy through the years. I don’t have to worry about too many things that I would own. I think that’s one important thing that I think mentally I’ve gone through through the years. The second thing is, you know, health scares tend to make you really reflect on your life a little bit, right, especially after you have kids -- like my daughter was born on 31st December, 2015 and my life has never been the same since then. And parenting brings about a level of detachment to purely financial outcomes that is actually healthy in a way. And it’s sort of in general increased my empathy, patience, just desire to work with those who only care about the relationships versus just being very transactional. And something that gives me -- and only wanting to work on things that gives me a sense of purpose professionally, intellectually, etcetra while keeping my family as the number one priority. I was talking about the health scare, like I realized about two years ago that I had a very, very high chances of getting diabetes given my father is diabetic, my grandmother passed away because of diabetes and I realized that a very, very high chance, there’s a greater than 90 percent chance is what the doctors told me that I would have diabetes which is why I gave up sugar. This part is not known, it’s only known that I gave up sugar, it was not known why. And that’s why I gave it up, I think in normal circumstances I may not – I may have just said look, it’s still okay, like on the age front I’ll deal with it later. But after my daughter was born and I’ll also add after my son was born because he’ll be very angry if I told you although he’s only three but after my daughter was born I think I’ve just had this desire to live as long as I can. And so I’m doing everything I can to enable that, right, like reduce my risk of contracting diabetes. So I’m happy to share that – you know, I actually have been testing myself every three months since that day and I’ve only once gone past the red line and every for the last six quarters I’ve been in the green zone. And the doctor is surprised that I have continued to do that because they didn’t expect it. And so I think just having that sense of greater purpose has sort of really helped in some ways over the last many years.

Tarun:

Excellent. I know you’ve written about how it’s also actually helped you just be a lot more focused.

Kunal:

Yeah, that too.

Tarun:

So, Kunal, I know you’re out of time and you’ve actually overshot your time by I think 20 minutes. So really appreciate it, I think it’s been a fantastic session. I know we can probably go on for hours talking about various topics and answering questions. But, Kunal, thank you so much for doing this and thank you for everyone joining in. Apologies if the start was a bit choppy, it was doing this for the first time so still getting used to the platform but I think it went off pretty well. So appreciate everyone joining in for the support. I’ve really, really enjoyed I guess interacting with everyone. And, Kunal, super thanks to you.

Kunal:

Thank you. Thanks, Tarun, it was a pleasure and thank you everyone for joining and spending so much time with us. And Tarun, you were fantastic as expected.

Tarun:

Thank you. Hope to be back here soon for another one. Good night guys.

Adil:   

Good night. Thanks, Tarun and Kunal, great session.

Tarun:

Great. Thank you everyone and see you.

Salonie:

Thanks for tuning in. For more Matrix Moments episodes, you can head to www.matrixpartners.in/blog. You can also follow us on Twitter, LinkedIn, and YouTube for more updates