Mutual Funds Get 19 Lakh New Investors In 2 Months

New Delhi: Mutual fund houses added close to 19 lakh investor accounts in April-May of 2017-18, taking the total tally to a record 5.72 crore, driven by growing interest from retail and HNI investors alike.

This is on top of 77 lakh folios added in the entire past fiscal and 59 lakh in the preceding financial year. In the two years, investor accounts went up following robust contribution from smaller towns.
Folios are numbers designated to individual investor accounts though an investor can have multiple ones. According to data from the Association of Mutual Funds in India (Amfi) on total investor accounts with 42 active fund houses, the number of folios rose to a record 5,71,90,112 at the end of May from 5,53,99,631 at March-end, a gain of 17.90 lakh.

Growing participation from retail as well as HNI (high net worth individuals) categories have contributed to higher overall investor accounts, FundsIndia.com Head of Mutual Fund Research Vidya Bala said. The number of retail investor accounts, which comprise equity, equity-linked saving schemes and balanced categories, surged to 4.60 crore in May-end from 4.4 crore at the end of March.

Mutual funds have gained popularity among Indian investors in the last two years

“A good percentage of investors stay invested in equity oriented schemes for at least 24 months or more than that. This increase in equity-oriented schemes holding period is for applicability of long-term capital gain,” Bajaj Capital CEO Rahul Parikh said.

“Even the Investors’ confidence in MF has increased. Now they are holding their investments in equity-oriented schemes for a longer period of time for both lumpsum as well as SIP (systematic investment plan) investments,” he added. Overall, the country’s mutual fund industry managed an asset base of over Rs. 19 lakh crore, which is likely to cross the Rs. 20 lakh crore mark this fiscal.

Mutual funds are investment vehicles made up of a pool of funds collected from a large number of investors. The funds are invested in stocks, bonds and money market instruments, among others

 

Top 5 Personality Traits Investors Look for in an Entrepreneur

People often ask me what kind of personality traits successful entrepreneurs possess? I’ve always maintained a mental list, based on my observations over years of meeting with entrepreneurs who have founded, scaled and exited businesses.

To explore this further, I thought it might be interesting to gather the perspectives of professional investors at venture capital funds who have backed some of the biggest names in technology startups including Pinterest, Uber, Boxed and SeatGeek. In general, several recurring attributes emerge, supporting the fact that investors believe there is a certain personality profile that is predictive of success. Furthermore, many of these traits are areas that entrepreneurs can diligently work on and improve, and not necessarily things that are innate — meaning people aren’t just born with it. Five traits that tend to be associated with the most successful entrepreneurs include:

Top 5 Personality Traits Investors Look for in an Entrepreneur

1. Tenacity.

In my interactions with VCs, this probably comes up as the single most critical ingredient to realizing entrepreneurial success. The value of tenacity was not lost on Woody Allen, who’s credited with coining the notion that “80 percent of success is showing up.” Nihal Mehta, ENIAC Ventures, looks for a founder’s ability to break through walls. He suggests, “startups have many twists and turns, ups and downs. Founders who go the distance look at each challenge and pace themselves to overcome each and every one.”

2. Passion.

Related to tenacity is motivation — why is an entrepreneur so focused on solving a particular problem? Chances are, if it’s purely about fame or fortune, the inevitable frustration that will come along when things don’t go smoothly may start eroding the intensity needed. Some investors look for opportunities where an entrepreneur is trying to solve a personal problem. “I like entrepreneurs who decided to solve a pain point that affected them personally,” says Vasu Kulkarni, Courtside Ventures. “The conviction to solve a problem is always stronger when you are passionate about it, and generally that tends to stem from issues that you can relate to personally.”

3. Confident humility.

Though it may sound like a contradiction, investors cite confidence and humility as traits that they’d like to see in the founders they back. Changing the status quo requires conviction and steadfastness that is convincing to investors, customers and employees. At the same time, the ability to listen and adjust is critical in being responsive to ever-changing challenges. Checking individual pride at the door is key to this. David Frankel, Founder Collective, looks for “audacity” but encourages entrepreneurs to balance this with some degree of humility and to always be asking questions.

4. Clarity of thought.

A straight line between a problem and a solution demonstrates a mastery of knowledge that presents an entrepreneur as someone who knows his or her stuff, as well as as an ability to effectively communicate. Having domain expertise is critical, but if you cannot present it as such, it can give the impression that there may be holes in the vision or ability to execute it. Matt Turck, FirstMark Capital said, “The best founders are deep students of their industry and entrepreneurship in general. They focus on understanding every single nuance. This manifests itself through clarity of thought.”

5. Curiosity.

An important part of being innovative is thinking about the “what ifs” of a business. Being reactive and responsive is important but it should be blended with a proactive approach to identifying and solving problems. This requires a level of curiosity which can save time and money. Matt Hartman, Betaworks, says “we invest in people building products that are fundamentally about new consumer behaviors. In these types of products, it’s critical to be curious about how and why new behaviors emerge.”

It is no coincidence that as businesses evolve and go from one stage to the next, so does the development of their founders and leadership team.

 

Agri-tech startups have a field day as farmers, investors sow seeds of growth

In Indian agriculture, the scope—and application—of technology has long been limited to genetically-modified crops, high-yield seeds and, of late, a handful of sophisticated tools like aerial images and GPS technology. Needless to say, a lot of challenges that farmers faced remained unresolved, partly because there were no problem-solvers around.

But that’s fast changing. Leveraging rising mobile and internet penetration, an army of agri-tech startups is offering farmers services such as on-demand delivery of farm inputs, online financial assistance, weather updates, drone-driven crop health identification, soil health assessment and equipment on rent, among others. Then, for purposes of edification and infotainment, there are startups offering both financial literacy videos and online games, such as Wonder village and Farmer Book!

The array of offerings clearly suggests these startups are finding takers in farmers.

Ayush Nigam, co-founder of Distinct Horizon, a fertiliser application startup, says the biggest change the industry is seeing is that farmers are now willing to adopt new practices that can improve yields or reduce cost. They are open to trying new technologies as long as they are sustainable and don’t require too much additional labour.

Distinct Horizon, which has developed an innovative machine for deep placement of urea fertiliser to increase crop productivity, counts Tata Chemicals and San Francisco-based IDEO.org as partners. Nigam, who feels the space has been underserved for decades, claims his deep placement technology not only doubles farmers’ profits but also helps maintain better soil health.

Then there are startups like Ravgo, a farm equipment rental marketplace that holds out hope for small farmers who cannot afford expensive machinery. Ravgo follows a commission-based model, wherein it charges a certain percentage from vendors for the business it generates for them. The fact that analysts peg India’s tractor-hiring market alone at Rs 15,000 crore per annum indicates the potential of the segment.

The supply-chain space, too, has seen several startups, with logistics between farmers and end-customers continuing to be a tricky area. Others have gotten into primary processing, packaging and selling of produce, spanning the entire chain.

Rising investor interest
Several of these ventures have been able to raise funds from prominent investors like Indian Angel Network, International Finance Corporation, US-based venture capital fund Unitus Impact, and even Denmark-based Bestseller Foundation, a private philanthropic organisation.

“The sector is evoking investor interest because of the enormous market size and the new-found thrust on the end-customer. If entrepreneurs can prove that their concept works and farmers are willing to pay for it, investors will grab the opportunity,” says Nigam. In case of Distinct Horizon, he claims, the precise fertiliser application technology helps the company recoup four times the investment in the first year itself.

Gajjender Yadav, founder at cow milk delivery startup 4SFoods, feels the rise of socially-responsible consumerism is giving the industry a fillip. Besides, the fact that these startup entrepreneurs are not just sitting in AC cabins, but are willing to get their hands dirty, is also driving the change.

Also, investors are placing their bets on startups like 4SFoods, and other farm-to-fork and organic food ventures given the rising propensity of the Indian consumer to loosen their purse strings for healthy, pesticide-free food.

“The disposable income with the middle class is growing, so they want to spend money on quality of food. As long as the consumer is willing to pay, there is no risk in investing in these companies. Look at the organic sector. No one was talking about it 5-6 years ago, but now people are buying organic, they are willing to pay 10-20% extra for packaged, pesticide-free food,” says Kushal Agrawal, partner and CFO at Aspada Investments, an early-stage venture capital firm that has backed fresh-produce distribution startup WayCool and on-demand farm mechanisation services company EM3, among others.

Using Bangalore-based Farmily, farmers can set up micro-sites to display their produce and reach out to potential customers. Whenever a customer shows interest, the farmer receives an SMS with the customer’s details, which eliminates middlemen from the process.

Another app-based startup, Mandi Trades, also connects farmers and buyers.

“Farmers face significant challenges at every point from buying agri-inputs, to improving yields and finally getting a good price for their produce. We are working on solving some of these challenges through technology,” Shardul Sheth, founder and CEO of AgroStar, had told VCCircle earlier this year.

A direct-to-farmer m-commerce platform, AgroStar is operational in Gujarat, Maharashtra and Rajasthan and claims to have over a million farmers on its platform.

Big Data isn’t behind either, with startups in the space winning insurance companies and banks as clients.

Mostly operating on the software-as-a-service (SaaS) model, these startups capture data on crop growth, likely yield, soil moisture, temperature and humidity, among other things, sell it to relevant stakeholders. Buyers include players selling agricultural inputs to farmers, apart from insurers and banks.

And the value-proposition is undeniable given data is the ultimate commodity.

“For most insurance companies, the challenge is to estimate the risk profile of the farmer and his farm. You have to have a lot of information, in terms of what crops are being grown, the track record, data on soil, nutrition, weather and pest attacks, the likely output, and the farmer’s income,” says Hemender Mathur, agribusiness investment lead and venture partner at Bharat Innovations Fund.

Not a cakewalk
Agrawal says the creation of a strong farmer network is tough but paramount. “Because some farmers have been cheated by large corporates, they don’t trust you easily. They are cautious and on-boarding them is a challenge,” he observes.

He adds that if startups can figure out how to take “basic technology” to small farmers, productivity will rise.

On the tech side, the primary challenge is domain expertise.

For tech-driven startups, says Mathur, seamlessly integrating the technology platform with domain knowledge of agriculture is critical. “I think the challenge is to build multiple layers of analytics. How to analyse these data points in a form that it becomes more valuable and can be sold to multiple users. It needs a lot of domain expertise. People are not asking for data per se, they are asking for insights,” he adds.

Resilient food demand is, however, a good sign, and it will ensure there is always scope for innovation in all areas of agriculture.

“Challenges are on the supply side…there are so many intermediaries and inefficient handling. Aggregation is clearly the missing link. Primary processing, as simple as trading, sorting and packing, are also areas of big opportunity,” Mathur says.

As for the government’s role in the ecosystem, startups feel it needs to bump up the spend on farm inputs to unlock the sector’s long-term potential.

“The government spends almost 10 times of farm inputs on farm subsidies, but it needs to reverse the trend gradually. Farm subsidy makes a farmer dependent while inputs will make him much stronger and independent,” Yadav says.

 

 

Gimlet’s New Podcast Puts You Right in the Room as Entrepreneurs Pitch Their Businesses to Real Investors

Pitching a new business can be incredibly stressful or incredibly rewarding. The Pitch, a new podcast joining Gimlet’s lineup, puts listeners right in the middle of the process as entrepreneurs pitch their new companies to investors.

“The Pitch has the high stakes you expect from reality TV,” said creator and host Josh Muccio, “but you don’t lose the intimacy.”

The premise: entrepreneurs pitch their businesses in real time to get feedback and potentially receive funding from investors including Jillian Manus, a partner at Structure Capital; Phil Nadel, co-founder of one of the largest syndicates on AngelList called Barbara Corcoran Venture Partners; Howie Diamond from Ranch Ventures who looks for companies with a social-change agenda; Jake Chapman, founder of Gelt Venture Capital; and Sheel Mohnot, a partner at 500 Startups who sold his startup to Groupon in 2012.

“It’s unusual to see a project come in the door this fully realized and exciting,” said Matt Lieber, president and co-founder of Gimlet Media. “There’s a tension and a liveness that happens on this show that we really responded to.”

Noting that StartUp—which takes its listeners behind the curtain of what it’s really like to start a business—is one of Gimlet’s most successful shows, Lieber said, “The Pitch totally also fits in this space.”

 

The Pitch is technically in its second season, but it’s the first with Gimlet Media after the podcast revamped its format. The Pitch is also the second show Gimlet has acquired. Science Vs joined Gimlet from the Australian Broadcasting Company in October 2015. Currently, Gimlet has around 10 active shows uploading new episodes throughout the year.

In making a reality-style show, Muccio said he initially faced challenges choosing which businesses to feature and convincing investors to get on board.

“The founders are already in the middle of taking risks,” Muccio said. “So they see the benefit of broadcasting their message to listeners. We’ve been trying to find companies in their seed stages and investors to develop relationships with.”

Each season of The Pitch will take place in a different city. Casting has already opened for Season 3, which will be recorded in New York.

“I stumbled upon StartUp in 2014, soon after I sold my own startup,” Muccio said. “Podcasting intrigued me, and I eventually assembled a team of producers and editors who taught me how to do my own show.”

Lieber said that Gimlet’s most successful shows “are driven by the vision, passion and voice of a person with a strong point of view.”

“You can hear that in this show,” he said. “There are many different kinds of entrepreneurs, and Josh’s point of view is that entrepreneurship can be empowering.”

New episodes of The Pitch are released each Wednesday. The first episode is already available for download.