Profile: Founder, chairman and managing director of IDG Ventures India
• An entrepreneur must surround himself with phenomenal people.
• Transformative decisions can be informed decisions
I have known Sudhir Sethi for more than two decades now; I have worked with him in two computer companies and subsequently, when the time came, he became my venture capitalist. Later, when his employer Walden International decided to move out of India, he decided to return to the IT industry. After a few years of contemplative preparation while working there, he finally returned to what has now become his life’s calling: Investing in and raising start-up companies. Within a short span of six years since then, he has raised $150 million dollars and disbursed the fund. Right now, he is raising another.
Sudhir has always fascinated me for two reasons: His capacity to transform himself and his learning from the diverse set of entrepreneurs he has helped create. Today, we are meeting over a cup of tea at the ITC Gardenia in Bangalore. I want to know from him the essence of personal transformation and then, the secret of how to be considered by a venture capitalist who has received 4,500 business plans since 2006, of which he has invested in only 20.
Son of an itinerant diplomat, he was raised in countries like New Zealand, Myanmar and Pakistan. For the senior Sethi, each posting followed tenure in Delhi. “Each time I returned to an Indian school, I ended up at the bottom of the class and each time we were posted overseas, I always ended up ahead of the class—in the process not knowing which of the two was real”. Sometimes, the displacement was extreme, like being evacuated by a naval ship from Karachi when Pakistan and India went to war in 1971. All these taught Sudhir that departures must precede all arrivals and that rapid change and uncertainty always precedes transformation. So, switching between working in the IT industry and becoming a venture capitalist was not as huge for him as might appear from the outside.
I am not so sanguine about that one point. I have seen Sudhir in IT companies for a long time where his career was going well enough. In fact Dataquest magazine had predicted in 1993 that he was a future CEO. But at the inflection point where people move from senior to top management in a company, Sudhir moved away and joined VC firm, Walden. Most people did not quite know at that time what a VC fund was and what a VC did.
“Transformative decisions can be informed decisions. When Walden first contacted me, I visited the Gangaram bookstore and picked up the only two books on venture capitalists that the store had. I went about speaking to people, understanding the space and along the way, I asked myself what did I really want and how does this new thing fit my DNA. In making informed decisions, one must take time. I took five to six months and during this course asked countless questions”.
The outcome was that Sudhir Sethi, the marketing expert, switched to the world of fund raising, spotting entrepreneurial talent, reading business plans, asking probing questions, choosing the right entrepreneur to back and sitting on boards, helping them go from stage one to IPO. He repeated the same after his departure from Walden. He regrets vacating the space for a few interim years, but he is glad that he was able to take an “informed decision” to set up IDG Ventures India.
Now it begins to make sense to me.
The brain after all, ends at the gut and planned discontinuity, as a child of the head and the heart, may have a better chance at succeeding than an uninformed impulse.
We shift the conversation to how Sudhir Sethi takes his pick. How does one get noticed by a VC like him?