1Mby1M Virtual Accelerator Investor Forum: With Anshu Sharma (Part 4)

Anshu Sharma: Every niche of a market is part of a bigger niche. Forget about software and enterprise software, because it may be hard for people to understand what I’m saying. Let’s say someone says, “I want to start building cables. I’m going to start manufacturing cable for electricity.” That’s a very small market. It’s a niche.

That’s how telcom in India started. They literally started out by building cables. Then they started building handsets for the Indian government’s MTNL selling phones. As everybody knows, that’s not a cable company. It’s not even a phone device company. The founders may not know exactly how big the market can be, but if you can’t articulate even one or two paths to a bigger market, that’s a limitation of your vision. It’s not really a limitation of your market. I will overlook the niche of the market if your ambition and vision is large enough.

Sramana Mitra: What is the frequency or volume of your actual investments? How active are you?

Anshu Sharma: If I see three good companies this month, I will write three checks. There may be times where for six months, I don’t invest in anything because I don’t do outbound. I don’t reach out to companies. I don’t spend time thinking about investments.

Sramana Mitra: People just call you and if you like it, you invest.

Anshu Sharma: Yes. At any given time, I’m focused on a particular project I’m working on. The last year, I spent my time building up ClearedIn. That’s 80% of my time. I did do it full-time as a VC for two and a half years. When you go outbound or when you start broadening your funnel, it doesn’t really increase the quality of the deals.

In some ways, by being selective and being totally inbound, I’m only meeting people who really want my help. One day, I will look up the statistics on this. If I had to do a guess over the last five years, I’ve probably invested in more than one-third of the companies that I’ve interacted with. Most people have a one is to 10 ratio or much lower.

Sramana Mitra: That’s a unique perspective. You chose not to become a VC though. What was the thinking behind that?

Anshu Sharma: I think I’m both too young and too old to be a VC at this stage. I realized that while I enjoy investing and helping companies, I want to be much more hands on and operationally involved with at least one company that I’m working with. Even the most active investors write two checks a year. Sometimes some of those companies don’t work out. It did not seem to be the best path for me to spend. I can achieve some of the same effect by investing my own money. If I keep enjoying it, maybe later in life when I’m ready to stop being hands on, I can double down on that.

Sramana Mitra: You see yourself starting another company?

Anshu Sharma: Right now, we are taking a lot of time to get ClearedIn ready to launch. I will be starting another company as soon as that’s graduated.

Sramana Mitra: You’re doing it with other people and not as a CEO but more as an investor Chairman.

Anshu Sharma: I’ve done two of these so far. One is in healthcare. This one is in cyber security. I don’t have a pattern here. My goal is to take some of the ideas in my head and in other peoples’ heads and create the right company around it. It’s quite likely that the next company I do, I’ll end up being a full-time CEO and may work on it for the next five years. It’s also possible that it ends up being another incubation.

This segment is part 4 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Anshu Sharma
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