Long on India B2B SaaS
India B2B Software thesis by Malpani Ventures
Coming of age moment for Indian software
While software-as-a-service (SaaS) is entering mature territory in the developed part of the world, Indian SaaS is relatively tiny, but growing fast. Indian software as a percentage of GDP is expected to touch 1% to $50BN in revenues in the next 5 years.
India software entrepreneurship is growing fast too!
7 years ago, only 4 Indian software companies earned more than $50Mn in revenues. Today that number has grown 5x with over 20 companies earning more than $50Mn in revenues, and almost 50 of them poised to cross the figure in the coming 3-5 years.
Funding frugal innovation is our mandate, and B2B software fits like a glove
B2B software requires 50% less capital than a B2C non software business to attain unicorn status. This makes it a perfect fit for Malpani Ventures in our quest to fund frugal innovation in India.
Every customer is different, India software can cater to them all
Selling software to India or the World, and to SMBs or Enterprises are 4 different combinations, all of which require a completely different positioning. Fortunately, Indian software due to its inherent talent, experience, and cost advantage can sell to all of them.
Malpani Ventures portfolio across the value chain
Our current portfolio provides us an exposure of 3 of the 4 quadrants. With median revenues of $1.5+Mn, cash flow breakeven, and valuation of $10mn+, we have seen value creation off little capital raised.
What Malpani Ventures looks for in early stage companies
We like to stick to the basics. We want to see a large market (~$1Bn), high YoY growth (200%+), high net dollar retention (100%+), good sales efficiency (implying favorable CAC Payback), and high gross margins.
How Malpani Ventures values businesses
Rather than ascribing valuation multiples to historical revenues, we prefer ascribing multiples to good quality & growing revenues.
We are funding B2B software with a never seen before pace
We are confident of writing bigger checks and making bolder decisions based on thesis driven investing rather than ad hoc investing. We are looking to deploy capital with a never seen before pace.
Does your business fit what we are looking for? If so, please reach us on pitch@malpaniventures.com titled ‘B2B SaaS’ with your deck and relevant materials.