Oliphans scores big in startup jungle

MUMBAI: Oliphans Capital has often strayed from the dominant narrative of India’s startup investing — writing cheques to twenty-something IITians (better if they’re dropouts), fuelling a consumer technology boom — with impressive outcomes.
This Mumbai-based proprietary, early-stage investor co-founded by Anish Jhaveri and Mohit Gulati has a portfolio of nine companies, which has a cumulative market value of $1.2 billion currently.Its latest $2-million investment in one-year-old startup Prothom Industries is possibly the first VC action in local manufacturing.
Prothom is possibly the only Indian outsourcer to global toymaker Hasbro, which is tapping new manufacturing footprints outside China. Hasbro sourced more than $2.5 billion worth toys from China last year.
Prothom — co-founded by two experienced corporate executives Samarjit Bose and Arun Chandrachud — is a harbinger to the country’s potential in toy manufacturing. “One province in China has 20 million workers in toy making with $20 billion in export revenue. There’s an opportunity for domestic companies as China’s competitiveness wanes,” Anish Jhaveri of Oliphans Capital said.
Jhaveri and Gulati formalized Oliphans three years ago after selling their stake in broking firm Antique Finance to the promoter family of Sun Pharma. “We didn’t want to live our lives repackaging 7,000-odd listed stocks again,” Gulati said explaining their transition to startup investing.
They had two big winners in their portfolio by then. Jhaveri had helped Sameer Manchanda start up Den Networks, India’s second largest cable television operator now.
The country’s largest facilities management company Bharat Vikas Group (BVG) — founded by Hanumant Rao Gaikwad from Satara in Maharashtra — was the other. It manages Prime Minister’s Office, Rashtrapati Bhavan, Indian Parliament, besides hundreds of moving trains, employing 65,000 people.
Many of Oliphans-backed companies went to on raise funds from marquee global investors such as Goldman Sachs, Apollo Global Management, Warburg Pincus, 3i, Kotak Private Equity and Peepul Capital. It showed up with a recent hit when Warburg invested $134 million in Ecom Express, a delivery service catering to the burgeoning domestic online shopping.
Oliphans backed T A Krishnan and his three colleagues with 25 years of experience in courier industry to start Ecom Express. “It was a tough call because founders were around 50 years and not your typical youngster from the campus. But we didn’t get why entrepreneurs should be denied funding because of age and experience,” Jhaveri, who worked with CLSA and HSBC equities desk previously, said.
The other portfolio investments include Grab.in (formerly Grab a Grub), an e-learning startup Sigrid, OnlineRTI and online grocer Localbaniya. Some of these, like Sigrid, typifies current startup ecosystem: young IITians with tech prowess and an attitude.
Oliphans — which invests between half a million and $3 million — also supports investee companies with financing and debt early on. “When there’s a loan to service, it’s a bulwark against loosening up that happens after venture funding,” Jhaveri said.
Gulati added that early investments in Den Networks and BVG also stemmed from belief that experienced, mature professionals would drive change irrespective of how successful they would be. “We believed in Manchanda when he talked about the possibility of consolidating India’s fragmented cable operator market and the approaching digitization to create a local Comcast,” Jhaveri explained.