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1Mby1M Virtual Accelerator Investor Forum: With Yash Hemaraj of Arka Venture Labs (Part 7)

Posted on Thursday, Mar 28th 2019

Sramana Mitra: Before we move to the entrepreneurial discussions, could you talk a little bit about the three venture funds that have put Arka Ventures together. What do you envision would be their roles in follow-on financing in the companies that come into Arka?

Yash Hemaraj: We wanted to make this an open and powerful platform for our founders. Again, when you’re building enterprise companies or B2B-focused companies, it’s never a one-stage game. You have to build companies in stages. We wanted to partner with the folks who are united in this mission of providing an open and collaborative partner platform for all Indian entrepreneurs and helping them scale into the global markets.

We partnered with Bloom Ventures and Emergent Ventures along with Benhamou Global Ventures in order to provide this platform. The three of us are the founding VC partners. We have put the seed capital to get the fund rolling and start making adjustments. We’re also bringing additional partners, corporates, family offices, angel investors who otherwise would do angel investments on their own into the platform so that our entrepreneurs have access to a wide variety of network.

Between the three firms, we have close to $300 million in assets under management and up to 100 plus companies within the portfolio. There’s a lot of accumulated learning that our founders who are coming into Arka platform have access to right from day one.

Sramana Mitra: Could you also talk a bit about the first companies that you’ve invested in that is also in 1Mby1M? Help our entrepreneurs think through a little bit of what you found in this company that helped you decide to pull the trigger.

Yash Hemaraj: One of our first investments is a company called Primaseller. Primaseller provides an inventory management solution for omni-channel retail. The founder had the domain expertise of working in the supply-chain business for several years before he started this company. He built the company originally focused on the Indian market where it quickly pivoted to the global markets. It has a lot of customers from North America and Western Europe, all of whom have come organically onto the website and signed up.

They have excellent reviews on all the review platforms where they watched the appreciation for the product and how simple and easy it is to use it. What we saw was that there were elements of all the things that I previously mentioned in the company. When you look at what’s happening in the US retail industry, you think more and more retail stores are being disrupted by the Amazon model. They have to have operations in their retail stores. But also they have to have a direct-to-customer online channel.

The biggest challenge when you’re trying to do this is inventory management. Inventory management is one thing where if you don’t do it well, it’s a lose-lose situation. Meaning, if you don’t have the right inventory in place, you’re going to lose the customer. The customer’s going to walk into the next store and buy the product. Too much inventory, that means that you’re incurring a lot of inventory-related cost both from an opportunity cost of the held up capital as well from the additional expenses that you bear with storage with all the logistics around them.

That’s where having right inventory management is a very important problem that all the retailers are currently facing. What we found was a nice slick product that a lot of existing customers have already shown appreciation towards. Those are the elements of the company. Now, the advantage they have is that they have the operations of a few quarters already into selling to global clients. Now, the opportunity is to go slightly up market and increase the average ticket size.

Sramana Mitra: Great. Thank you for your time.

This segment is part 7 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Yash Hemaraj of Arka Venture Labs
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