We spoke to Mr Mohsin Khan, General partner at Hyderabad based seed fund and business accelerator Utthistha on their growth plans.
Mr. Mohsin Khan holds a Masters in Engineering from US and has also completed the Advanced Management Program (AMP) from Indian School of Business. He started his career in General Motors, USA as an engineer and grew to a Manager position, While working there he handled strategically important projects spread across different countries. He joined CNO Financial Group (previously known as Conseco Inc) in US (a Fortune 500 company) as Managing Director for its India Operations and grew the company from 1 person to 370 people. He started his entrepreneurship journey by negotiating a minority stake in CNO India, which he sold back to the parent company CNO Financial Group, Inc on mutually agreed terms. He headed the operations of the subsidiary – CNO IT Services (India) Private Limited at Hyderabad in the capacity of a Managing Director. He is currently the Charter Member of the Hyderabad Chapter of the Indus Entrepreneurs (TiE). He is also a Member of Hyderabad Angels and is actively involved in the Hyderabad chapter of the CEO Clubs.
WD: What is Utthishta all about? What problem are you solving?
Mr. Mohsin: Utthishta, as the name suggests, has been launched to facilitate the spectacular rise of start – ups. We are a seed fund and a business accelerator. We invest in companies that are built around upcoming technologies like web, mobile, cloud and software products. Utthishta Yekum Fund is organized as a trust under Indian laws and is registered with the Securities and Exchange Board of India as a Category I AIF under the SEBI Regulations, 2012
The problem that we are trying to address is that of availability of funding to startups at an early stage. In India, startups still rely on the age old norm of approaching Friend, family and fools for the 1st round of investment, as there are not many alternate avenues available. We at Utthishta intend to address this problem. We provide the incubatee company with a capital of Rs.10lakhs for equity of 15%. Also, there is a lot of scope for seed funds in India because currently there are hardly any funds operating in that space.
Mr. Mohsin: Utthishta was started as an initiative by Mr. Mohsin Khan and Mr. Ramakrishna, with Mr. PrabhakarRao as the anchor investor in the fund. The major challenge that we faced was getting the SEBI approval, which took almost nine months.
WD: Who are the Founders and their backgrounds?
Mr. Mohsin Khan – as mentioned under question 3
The other founder is Mr. P Ramakrishna
Mr. P Ramakrishna is a commerce and law graduate from Andhra University and also a rank holder. He is Fellow member of Institute of Chartered Accountants of India. He has about 3 decades of rich experience across various domains including business development & strategic planning, auditing, accounting, process controls, risk management, corporate governance and compliance, tax structuring and succession planning. His functional expertise lies in deal making, valuations, due diligence, negotiation support, joint venture structuring and fund raising. He was formerly an Executive Director and the National Leader – Entrepreneurial and Private Client Service at PricewaterhouseCoopers Private Limited. He is a regular speaker at events conducted by CII, FAPCCI, ASCI, ICAI and ICSI. As a Lead Partner and Engagement Partner for Assurance, he has advised and reviewed various companies (business groups) which have grown many folds in a short span like Care Hospitals, Rain Commodities, Greenko, Lanco, GMR
WD: How is your Program different then other Investors ?
Mr. Mohsin: Most of the VC companies in India are like High School / College. They generally invest in all domains/segments
There are four distinct aspects that differentiate us from our competitors:-
- We are the Primary School for Entrepreneurs in India and are focussed on upcoming technologies like web, mobile, cloud and software products
- We bet on complete strangers that are sourced from all across India based on merit and pre-defined selection criteria only – focus on very early stage
- We focus first on business acumen / market risk and the second to that would be team risk and last would be technical risk
- Our combination of two general partners where one is from technical, entrepreneur and operations growth side, and other from finance, audit side
WD: What kind of Startups are you looking to invest in ? What kind of Problems are you looking at Startups to solve and in what areas ?
Mr. Mohsin: We are a primary school for startups and hence we look to invest in teams that are at a very early stage of their business cycle. We are looking for companies that are working on upcoming technologies like web, mobile, cloud and software products. We would select a team based on the pain point that they have discovered and how they plan to address the same.
WD: What initiatives are you planning in the next 2-3 years for the Startup community ?
Mr. Mohsin: There aren’t any specific other than we plan to fund around 20 or 25 startups each year.
WD: What is your take on the Indian startup scene ? How easy/difficult it is for the Investors/Startups in India ?
Mr. Mohsin: India is still at very nascent stage when we talk of the startup scenario. We will have to go a long way to match the kind of numbers and deals that we see at Silicon Valley but its catching on. We are seeing more and more students at professional colleges opting for entrepreneurship as a career via-a-via a secure job in an MNC. There are a lot of problems that need to be addressed in the Indian markets and we hope to see a lot more entrepreneurs coming up with ideas that could address these pain points.
It is not very easy for startups in India. They not only have funding issues but also the societal pressure is high. The Indian society has still not come to accept the idea of entrepreneurship being a viable career option. The entrepreneurs face a lot of pressure from their families and peers to confirm to social patterns and hence take up jobs in big companies.
The Investors do face hurdles in terms of sourcing good deals and also the regulatory hurdles that complicate the investing process. There are also some hurdles in terms of exits.
WD: What are the different types of investment ?What should they do to secure fruitful investments ? How much equity they will require to dilute ?
Mr. Mohsin: We only do one type of investment as Utthishtai.e Equity funding. We fund 10 Lakh Rupees and take 15 % equity. That is our model.
WD: How can the Indian Entrepreneurs reach you ? What is your process of selecting/investing in Indian startups ?
Mr. Mohsin: Our selection process in explained in details on the website. Please see the link below :
Entrepreneurs should only apply through website as the data is directly stored in a database from there. We will contact the entrepreneur once they apply on website.
WD: Your suggestion for the Indian startups/entrepreneurs?
Mr. Mohsin: Focus on pain points that are not resolved yet and don’t just copy US business models in India because our problems are very different than those found in the west. We need to focus on our problems then only the markets will reward us
WD: Finally your suggestion on how WirelessDuniya can be the connecting platform between startups, investors &mentors ?
Mr. Mohsin: Keep interviewing and publishing more articles from startups in the wireless space along with accelerators like us. That will help WD become the connecting platform.