Tandem Capital takes startups to Silicon Valley
Indian HNIs may have backed Tandem with the hope that Silicon Valley’s mature startup ecosystem can help startups scale globally and thus earn exits relatively easily.
Tandem, founded in 2007 by IIT Madras and Stanford-educated Oracle veteran Sunil Bhargava and another former Oracle executive Doug Renert, has had investors for its first two funds-$10 million Tandem I and $33 million Tandem II-mostly from Silicon Valley.
Armed with the new fund, Tandem is now drawing up a strategy to select a few Indian startups every year, take them to the Valley, help them find a product-market fit and fine-tune their go-to-market strategy.
Of more than 20 startups Tandem has invested in the last eight years, only two are based in India.
US-based entertainment company Game Show Network LLC acquired the gaming startup, which raised $1 million from Tandem and other investors in April 2012, for $165 million in March 2014.
According to Bhargava, the number of Indian companies in Tandem’s portfolio is poised to grow with the Indian startup ecosystem maturing.
Discarding the time-bound approach usually followed by accelerators, Tandem accepts startups anytime into their accelerator programme and desists from pushing companies to a ‘demo date’.
In the new $100 million fund, Tandem has decided to initially invest $200,000 to $300,000 in each startup and has reserved “a few million dollars” per startup for follow-on investment.
With its corpus tripling from its previous fund, Tandem is also now in a position to partner with startups beyond the acceleration phase, Bhargava said.
Even as Tandem finalises investment in a few more Indian startups, it is charting out a light engagement programme to help Indian startups connect with investors, mentors and customers in the US. “We want to do a light engagement programme for early stage companies who want a sounding board in Silicon Valley. We will put in $20,000-25000 in each company and let the startups spend some time in the Valley. We will connect them with investors there. We will select 15-20 startups for this programme,” said Bhargava.
(Credits to Manu P Toms)
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