1Mby1M Virtual Accelerator Investor Forum: With Cem Sertoglu of Earlybird Venture Capital (Part 1)

Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Cem Sertoglu, Earlybird Venture Capital was recorded in October 2017. 

Cem Sertoglu is Partner at Earlybird Venture Capital, based in Turkey. Cem brings the spotlight on Turkey and the Eastern and Central European startup eco-systems.

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1Mby1M Virtual Accelerator Investor Forum: With Ashmeet Sidana of Engineering Capital (Part 4)

Ashmeet Sidana: There’s great wisdom in what you’re saying. It is not just something that entrepreneurs should think about doing. You are required to say no to money on the path to success. Every company that is successful, at some point, says no to large amounts of money along the way.

Here’s the way I visualize it with my CEOs. What I tell them is, “You’re running a marathon. Any money you raise is candy. The real thing that you want is whole wheat bread and lots of protein. That’s how you run marathons. You don’t run marathons by eating candy. Raising money is like eating candy. Where is the protein? Where is the whole wheat? That is revenues and profits.”

That is the analogy that I always make. I haven’t seen Pygmalion, but the wisdom of middle class morality was brought to me by >>>

1Mby1M Virtual Accelerator Investor Forum: With Cindy Padnos of Illuminate Ventures (Part 3)

Sramana Mitra: I have a specific question that relates to our community. We have a global base of entrepreneurs. Very often, entrepreneurs have their development teams elsewhere, whether it’s India, Eastern Europe, or other parts of Europe, but they’re aware of the fact that if they’re going for enterprise customers, North American customers are the primary customer base they want to go to.

How do you look at those companies? How do you define North American companies? Do these kinds of companies fall within your scope or are they outside?

Cindy Padnos: They’re well within our scope. Most of our companies have a portion of their development resources offshore.

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1Mby1M Virtual Accelerator Investor Forum: With Ashish Gupta of Helion Ventures (Part 4)

Sramana Mitra: Especially for companies coming out of India who sell using inside sales either into the large enterprises or SMB, the SMB market has a lot of headroom in terms of the next 5 to 15 years. That is a market where there is a lot of technology going in. It completely aligns with India’s strength in building global cloud plays.

Ashish Gupta: Especially in those products that are fast follower products. We are still not world class in product management or user interface, but if there is a fast follower opportunity where one can learn from the leader as to what product to put in, that becomes a very interesting example of what you’re calling out. >>>

1Mby1M Virtual Accelerator Investor Forum: With Ashmeet Sidana of Engineering Capital (Part 3)

Sramana Mitra: The public market, though, is not in a bubble. The public market is reasonably sane these days. Most of these companies who are getting these ridiculous private market valuations would not be able to go public because they don’t have the numbers to go public.

Ashmeet Sidana: I agree completely. It’s on a case by case basis. There are also great companies that get created. As an entrepreneur, what we have to keep in mind is, markets come and go. Markets are cyclic. Economies are always cyclic. Businesses don’t have to be cyclic.

If you can build a company that has true technology innovation and a true sustainable barrier to entry and a competitive >>>

1Mby1M Virtual Accelerator Investor Forum: With Cindy Padnos of Illuminate Ventures (Part 2)

Sramana Mitra: Let’s flip that question around. Now that you have been in this business for a while and you have an investment thesis, what are you looking for? Can you pinpoint where do you want to invest in? What kind of industry trends and segments of the B2B space are of particular interest to you?

Cindy Padnos: We tend to invest in companies that are leveraging all of the data that is being collected today. They take these vast amounts of data but the vast amount of data are collected in our SaaS business applications. They mind that data. They do incredible things with it.

Those are companies we’re typically looking for. They are leveraging machine learning and other AI-related techniques to build >>>

1Mby1M Virtual Accelerator Investor Forum: With Ashish Gupta of Helion Ventures (Part 3)

Sramana Mitra: It is also an evolution. This was not the case some time back. Startups had a very hard time attracting talent. That has changed. It’s become sexy and cool to work for startups in India. That’s a very good development.

Ashish Gupta: You’re absolutely right. Sexy is the word. In fact, I recently wrote an article giving some assurance to the people who are not in startups. Unlike the Valley where somebody who’s not working in startups is looked upon as a gargoyle, one doesn’t need to start worrying about that phenomenon. You don’t necessarily want people to become entrepreneurs just because it’s sexy. It exacts too high a price from everybody concerned.

Sramana Mitra: What is your current investment thesis? We got a little assessment of what’s happening today. 

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1Mby1M Virtual Accelerator Investor Forum: With Ashmeet Sidana of Engineering Capital (Part 2)

Ashmeet Sidana: The important thing to keep in mind is that building a startup is an evolution that occurs from the concept of an idea all the way to when they have revenue. At some point, they leave that company, which can be a journey of 5 to 15 years. Financing events are simply events along that journey. They are the side effects of that journey. There’s a seed financing round. Perhaps there’s a Series A and B. Even an IPO is just a financing event. All the great entrepreneurs continue to run their companies well after even the IPO.

Sramana Mitra: The other side of this coin is this whole explosion in capital in the late stage financing on very unreasonable terms and on very unreasonable fundamentals. I personally believe that that trend is going to slow down next year just because a lot of these companies that have loaded valuations and weak fundamentals are going to implode in the public market. >>>