Looks like VC firms have shed their ego-system affinity to blend in better with local ecosystems.
Earlier these very guys, recently Jet lagged, used to say, “we will invest in areas where we have specific domain and strategic expertise. We don’t invest in companies outside our area of core competence.” I took them for a disciplined lot. It’s their investors money and they know best to deal with.
But later they realized they are not getting very many investible ideas. Even as they felt the need to look outside IT sphere, they couldn’t easily let go off that elitist talk, let alone admit to their late blooming. So conceited were they, I had felt even in restaurants they don’t even look at the menu — just tell the poor waiters what they want to eat, and the chef will have to make it for them.
Now sample this. Srini Vudayagiri, of Lightspeed Advisory (India arm of Lightspeed VC), says the company now plans to start investing in companies outside the technology business in India. He said “40–50% of our investments in India will now be diverted to the non-tech sectors. This has been prompted by local market needs. We will mainly invest in consumer-driven sectors and allied infrastructure-led companies.” Srini says, Lightspeed is aggressively looking at non-tech investment in India because of strong economic growth, rising consumer demand and growing spending power.
What a change? During those days, I had a tough time telling these guys why they should look outside tech in India because that’s where the opportunity lay. A couple of companies that badly needed capital then had to take the difficult debt route but today their shares are quoting 20 x their prices then. In the end, VC’s loss was the founders’ gain…
Mine too, to a small extent that I owned their stocks… -)