She’s one of India’s most powerful investors. Here’s how Vani Kola does it

Vani Kola speaking at the Tech in Asia Bangalore 2016 conference.

In the world of India’s startups, Vani Kola is a stalwart. As managing director at Kalaari Capital, an early stage venture capital firm based in Bangalore, Vani discovered and groomed startup unicorns like Myntra and Snapdeal when they were still in their short pants, making her one of the most experienced early stage investors in the country.

Speaking onstage at Tech in Asia Bangalore 2016, Vani shared her investment playbook and what made Kalaari back early winners.

Early stage vs growth stage

Photo Credit: David Joyce

At around 2006, when the Flipkarts and Snapdeals had yet to shape India’s startup future, the general tendency was to back growth stage companies. Kalaari bucked the trend, betting on backing early stage companies instead.

“We were not looking for a proven team or something that has a lot of action. We wanted to go with founders who were building a new thing,” Vani said at the conference.

Small businesses rule in India

Photo credit: Milaap.

While countries like China or even the United States saw success in startups that were big-business focused, Kalaari’s bet was that in India, startups that worked along with small and medium sized businesses would rule.

The country had rules that did not allow ecommerce companies to hold inventory. Snapdeal adopted the Alibaba playbook of being a marketplace very early, giving it a slight edge.

See: Amazon and Flipkart may be in trouble after India’s policy change. Snapdeal is happy

“India is not a homogeneous market from a demand-supply side – it is a fragmented market,” Vani said.

“That is why we focused on small and medium enterprises enablement. Marketplaces are all about that. We started determining what are the possible investment opportunities for a country that has this trend.”

Beyond KPOs, please