Shark Tank's Aman Gupta On 'Crazy' Funding Winter, BoAt's Return On Investment
boAt, which has grown to have its own manufacturing facility and a top line of Rs 4,000 crore, has backers in marquee investors such as Qualcomm Inc. and Warburg Pincus LLC.
It's been a "crazy" funding winter, and it doesn't seem to be ending, according to boAt co-founder Aman Gupta.
The Shark Tank-fame investor played on the famous Game of Thrones dialogue to describe the funding scenario that has rocked the startup ecosystem in the past 12 months. "There, they say 'Winter is coming'. I would extend it and say 'Winter is not going'," he told NDTV Profit.
Gupta, an active angel investor, had said earlier that there was free money available, but now investors have realised that they cannot keep funding loss-making startups as they were doing earlier. "They cannot fund non-sustainable businesses. Free money is not available and so, winter is here. Good companies are still getting funded."
While it wasn't easy raising funds for boAt, given that there were few startups in the wearable spaces, due diligence today has increased multifold, Gupta said. "There were a lot of compliance issues, which were being ignored by investors. Apart from IQ (intelligence quotient) and EQ (emotional quotient), founders will be measured on GQ (governance quotient)."
boAt, which has grown to have its own manufacturing facility and a top line of about Rs 4,000 crore, has backers in marquee investors such as telecom major Qualcomm Inc., Warburg Pincus LLC, Fireside Ventures and InnoVen Capital. All these backers are in the green on their investment, Gupta said.
"Fireside had invested around Rs 6 crore in the first round and we've already given them a Rs 100-crore exit. It's our fiduciary duty to provide returns to our investors. We've cleared off all the debt from InnoVen as well," he said.
"If you look at Warburg and Qualcomm, they came in at a valuation of Rs 1,500-1,600 crore, so they're already in the money. They can take an exit today and at a good multiple. There is still growth left in the company and that is why they're all invested till now."
Gupta, who is also boAt's chief marketing officer, counts Let's Try, Bummer, Skippy, House of Chikankari and Beyond Snack as his top investments. Apart from that, his portfolio company—e-commerce enabler unicorn Shiprocket—has also done well, he said.
"Some of these deals can return the total money I've invested over 40 deals also," he said.
