Global venture capital firm Antler committed to investing $100-$150 million in India amid the 2021 funding rush, now as the funding momentum slows down worldwide, BusinessLine spoke to Rajiv Srivatsa, Partner at Antler India, about the firm’s investment strategy. Excerpt:


In 2021, Antler committed to investing $100 - $150 million in funding over 100 Indian startups in the next three years. Can you give us an update on this commitment, and how many of these investments do you expect to do this year?

Between Jan 2021 and late May 2022, we have made 20 investments across various themes and sectors. Beyond the core pre-seed investments, we also run two programs Antler India Fellowship and Antler India Residency. Antler India Fellowship is focused on college students, the first version of this was launched in December 2021. We have selected eight students for the programme, to whom we are giving a $20,000 grant. At the end of the sixth month of the programme, we will maybe invest in 2-3 of them.

Further, Antler India residency is where we focus on people who are in the throngs of leaving their job or are working on multiple ideas. Here, we do a cohort of 60 people, and the grant is around ₹3 lakhs. The first batch is happening between June 20, 2022 and September 20, 2022. The idea is to pair some of them, work with them for four months and invest in maybe 8 to 10 companies. 

For this year and next, we will probably do 30-35 investments through Residency, and maybe 5-10 investments, through the fellowship. Then the bulk of 50 investments of which we have already done 20, will be core pre-seed. In pre-seed, we do a $300K - $350 K cheque for 6 to 9 per cent stake in the company. All of our investments are at the concept level. 


Are there any specific themes where you like to invest?

We have a natural affinity for around six themes, of which two (climate and mental health) we haven’t started investing in. The other four are, Web3, fintech, SaaS and D2C.  Web3 and SaaS will form almost 50-60 per cent of Antler India investments because they are all global, and there is a natural affinity for Antler’s strength. We believe that the next ten years will be a lot of unicorns and decacrons in just these two spaces (Saas and Web3). Hopefully, we will also do at least 5-10 investments in climate and mental health over the next 1-2 years. 


Given that Web3 is a major focus, does Antler plan to invest in tokens, or would you make equity investments in Web3 companies?

We cannot make token investments right now, but we are getting a Singapore license to be able to do that. It is in the final stages, and we will probably have a global announcement in a few months, around investing in tokens. However, we expect mix both equity and token investing. It’s just a function of the kind of company. For example, in the case of Polygon, token investing today makes much sense than equity. But at the start of a company, it also makes sense to do equity rather than tokens. We come at the concept level, so for us, it will always be a mix of two.


Globally the startup ecosystem is undergoing a funding crunch, does that impact Antler’s funding strategy in any way?

We will make more investments this year than last year. Because we also are doing something like the Residency for exactly that reason. It is for people who have always wanted startup, and are hesitant because of the market conditions and people losing jobs etc. We will make it easier for them to find a co-founder and give them a stipend for a few months. So something like Antler India Residency makes a lot of sense now, compared to last year, when raising money was relatively easy. So, I think the residency was something towards that effect.

Also, funding momentum changes don’t matter for us as much because our cheques and valuations are reasonably standard. The stress is greater in late-stage rounds and some A, B, and C rounds. Thankfully, our companies will be at that stage after 12 months. So, they will build assuming there is going to be a capital crunch and better built in terms of their foundational frugality and the way they grow.