1Mby1M AI Investor Forum: Piyush Kharbanda, General Partner at Vertex Ventures (Part 1)

Piyush Kharbanda, General Partner at Vertex Ventures, discusses his firm’s AI investment thesis.

Sramana Mitra: We are going to start today’s session with Piyush Kharbanda, General Partner at Vertex Ventures, and we are going to discuss Vertex and Piyush’s AI investment thesis. Just as the AI conversation has been accelerating a couple of years back and more action started kicking in gear with that action, there was a lot of confusion. We started doing these AI investment thesis conversations with our investor guests and started clearing some of those confusions up and really trying to understand what is happening in the market, what are people seeing, what am I seeing, and what conclusions are we drawing?

So, welcome Piyush. It’s great to have you. If you want to start by just introducing a little bit about Vertex. We’ve had your partners here before. Ben has been here before, but let’s reintroduce and then dive into the AI conversation.

Piyush Kharbanda: Awesome. That’s great and I’m super excited to be here. Let me give everyone a quick background to who we are and what we do and we can pick it up from there.

Vertex is a fairly global venture capital setup. We were born out of Asia, particularly Singapore many years ago. As do large and old organizations, we’ve gone through a bunch of changes over the last few years. In our most recent avatar, we act as a network of funds across the world. We have a team in the US, we have a team in Israel, we have a team in China, and Ben, I, and our colleagues are part of the Southeast Asian India fund.

Our fund is a $540 million fund. We raise capital from third party investors, but the sovereign fund of Singapore, which is Tamasek, is an anchor in our funds. Our thesis is to invest, like I said, in Southeast Asia and India. However, we are not only investing in our local markets but also investing in software startups that are globally relevant.

My focus remains India and a large part of what I do and where I invest is the India to US leg, or India to global leg where entrepreneurs build high quality software in India and sell it globally. That is very relevant to what we’re going to discuss, which is how AI plays a part in creating an upheaval in that market; and it’s been a pretty rapid upheaval, and we are going through it as we speak.

So, that’s about us, but we are not just software investors. We actively invest in the local markets. So, the Indian consumer and Indian financial services space is a big area of what we do. So, it’s fairly horizontal. From a thesis perspective, we are more a Series A investor, and that’s also been an evolution. We are among the earliest investors on the cap table, but probably not the first in many cases. And in many cases, we are the first as well.

So, that’s a quick background. Personally, I’ve been here for about nine years now, and I’ve been investing for about fourteen years. I used to work with a private equity firm before this. Indian mid-market private equity is very different from the West. I used to be with an Indian mid-market private equity fund for about five years before moving into venture.