Aviral Bhatnagar

Venture Highway LLP

Leading investments in SaaS, consumer and AI. Managing our student venture program. If you're building something, or planning to, reach out at aviral@venturehighway.vc.

A Junior VC

Making startup conversations more accessible - find out more at ajuniorvc.com

Founder

Guild Capital

Focused on early-stage/venture investments, and set up the India investing practice.

Investor

Morgan Stanley

Private equity with large infra-asset focus

Summer Investor

Function Space

Head of Growth

Education Edge

Award-winning startup focused on opening career options for Tier 2 city students

Co-Founder, Business Plan and Marketing Head

If you want to connect - reach out at aviral@venturehighway.vc

Join our platform on ajuniorvc.com - in case you want to know more write to aviral@ajuniorvc.com
Tweet at https://twitter.com/aviralbhat

Always learning about startups+investing+business building+storytelling

Graduated from IIM Ahmedabad ('16) and IIT Bombay ('14) where I spent time on startup tinkering, understanding businesses, storytelling and learning a way of life.

McKinsey is paying employees 9 mos salary to find a job

While their reason is an economic downturn, AI is making strategy jobs steadily redundant

Consultants' big JD is to make sense of scattered data and deliver structured advice

But $20/mo will be hard to compete for $1M/mo

IIT JEE and UPSC are probably the biggest enablers of upward mobility in the world, because there is no way the wealthy can buy their way to a seat

Children about their parents at:

5 y/o: "They are superheroes"
15 y/o: "Wait, I don't think they make sense"
25 y/o: "They don't understand anything"
35 y/o: "Wait, I think they made a lot of sense"
45 y/o: "They were superheroes"

Surprised and not surprised that Pune is almost as big as Bangalore from a GDP perspective 

Pune has quietly been growing with a nice mix of industry, IT and startups 

Great weather, good infra and a lovely place to live

Likely to become a top 4 Indian hub soon

India's Civil Services select about 1,000 from 10L applicants, while the UK's does the same from 30K

Just 5,000 IAS for 134 Cr Indians, while there are the same for 6 Cr Brits

Increasing IAS seats will go a long way in solving both stretched bureaucracy and aspirant dreams

Mercedes sold a record 5,700 units last quarter, equal to all other luxury cars

80% of Mercs are 75L+, implying the revenue is likely 5K Cr+ for the quarter or 20K Cr annual

Merc with just 22K customers is larger than Apollo/Zomato, and 90th by rev in India

Fortune at the top

"LVMH, Gucci, Cartier to expand in India by adding outlets to Jio Centre due to explosive luxury demand over two years"

"HUL, P&G face deep decline in rural sales due to negative growth in demand over the last two years"

Welcome to India, a continent of contradictions

Tune into our podcast with an IIM Ahmedabad alumnus who went to McKinsey and is now playing the long game baking: https://lnkd.in/dx3exYXf

Norway's pension fund has become one of India's biggest investors with holdings of 2 lakh crore

Size makes it India's second largest FII after Singapore, investment is 2x Axis and close to Kotak

But the pension fund is so enormous, India is just 2%

Large, yet patient capital

Louis Phillipe, Van Huesen, Allen Solly appear to be aspirational brands  

Foreign named brands appear to be a good proxy for quality, resulting in sales of 12K Cr+  

But all are owned by the unknown Madura Garments, so big it's being spun off to list by Aditya Birla

Clever

"A man who procrastinates in his choosing will inevitably have his choice made for him by circumstance."

- Hunter Thompson

Gujarat Titans have played 2 IPL seasons, topping the tables both times and winning their first season

Incredible performance for a new team, perhaps driven by a unique owner

$100Bn PE firm CVC owns GT, which also owned F1 and La Liga

Professional firms could transform IPL teams

IIT Bombay apparently had 36% unplaced, now IIT Madras apparently has 45% unplaced

30-40% of IITians in total end up going abroad, placed off campus, preparing for UPSC or starting up

None of them do placements

Unplaced %age is probably close to 5%, which is normal

India's middle class is not someone who earns 3L/mo or even 1L/mo

50th percentile income or "middle class" is someone who earns 9K/mo

Zomato's delivery execs are upper middle class or 80th percentile when they earn 15K/mo

Upward mobility is why they + so many move to cities

India’s rising underdog may not be from startups or tech, but 1,500 Cr Cafe Coffee Day

CCD appears to be finished. Iconic founder tragically passed 4 years ago. CCD had 7,000 Cr of groaning debt in 2019. COVID battered it beyond recognition. Starbucks is eating CCD for breakfast, lunch and dinner. Newer upstarts are making inroads. Far from rising, it is set in a coffin for good

But smelling the coffee reveals a loved brand pulling an audacious 5,000 Cr turnaround

VG Siddharth was born in a 140-year-old coffee family. Investing in stocks, he started Sivan Securities in 1984. Using gains to buy coffee farms, he amassed 10K acres of farms. By 1993, he got into the family biz. Trading coffee, Amalgamated Bean Company (ABC) traded 20K tons, with 3K tons produced by his farms. But interacting with a large coffee chain inspired him big

CCD was born in 1996 for a lot to happen over coffee

As India opened, new revolutions started. IT’s revolution powered India, CCD was about to power IT. CCD’s pioneering value, access, taste were packaged into hip outlets. Growing to 18 outlets in 2001, CCD was about to explode. By 2004, CCD had 150 outlets. Giving ABC to friends, VG took CCD abroad in 2006. Raising $20M from VCs, by 2009 CCD was in 102 cities and 620 outlets

CCD’s insane growth attracted an astonishing $210 million round

Vertically integrated from farm to bistro, CCD reached 1K cafes by 2011. Priced better, clean, excellent ambience, in 2013 nobody could touch it. By 2015, CCD was in 1,500 stores. Dominating so much, 2nd place was 160 cafes. By 2016, CCD went public, with interests in logistics, real estate, finserv. Valued at $1B, CCD was flying

But by 2017 a storm was coming 

Competition grew fiercer. CCD expanded into new products. But debt exploded. From 1,300 Cr in 2011, CCD was at 7,000 Cr in 2019. VG sold his 3,000 Cr stake in Mindtree. Coke was trying to buy a CCD stake. Starbucks was exploding in India. CCD’s stress and VG’s personal debt of 1,000 Cr ended tragically. As CCD lost its founder, fraud arose, lenders knocked. COVID hit

VG’s wife Malavika would step up in 2020 to save the brand

Non-core businesses were sold. CCD’s tech park (yes) was sold for 2,700 Cr, wealth mgmt for 100 Cr. Logistics was put on sale. Store count was halved. By 2021, coffee startups scaled. $40M was raised. As competition scaled, CCD was still beset with insolvency, fraud and debt hangover. Yet by 2023, CCD was starting to look up

Incredibly after downsizing, CCD was still India’s largest chain

As a 4th wave of coffee emerges, CCD is slowly climbing back. Debt fell to 1K Cr. Vending machines scaled to 50K. Revenue is hitting 1K Cr. Market cap is up to 1.5K Cr. Most importantly, the brand is loved in a 20K Cr exploding coffee market. As CCD enters FY24 with a 15% jump, the journey of stardom and being an underdog is a story of grit

With details of its 30-year rollercoaster here https://bit.ly/49BuIpO), CCD could rise like a phoenix to win back India

EdTech in 2020: We will replace coaching classes with technology 
EdTech in 2022: We will replace coaching classes with coaching classes.
EdTech in 2024: We will replace coaching classes with apparel stores

UN's Security Council has UK and France as permanent members

UK has a GDP of $3.3Tn, a population of 67M
France has a GDP of $3Tn, a population of 68M

India has a GDP of $3.9Tn, a population of 1,400M and doesn't have a seat

The "Order" is neither a democracy, nor meritocracy

I hear everyone say let compounding do its magic, but nobody explains what it truly is

Compounding seems obvious to explain. You put money, it grows. Then, it has a larger base on which to grow. So on goes compounding. Seems straightforward. But in reality, the explanation is limited and superficial

Thinking deeper reveals what it truly is and the unexpected places you would find it

Compounding is the property of systems. Systems that can accumulate something can compound. This “something” is known in theory as stock. Wealth is the obvious example, but it can be GDP, human skill, networks, or even AI model performance. Understanding systems reveals the first deep truth about compounding

Multiple invisible parts of the system are at work, whose effort “shows up” as compounding

Wealth invested in equity grows because the underlying economic system is working. Billions of people, millions of businesses, and hundreds of markets operate in this complex system. But wealth held in cash doesn’t grow, revealing the second truth about compounding.

Compounding benefits only happen when you put your “skin in the game” on the underlying system

Cash doesn’t give you any skin in the game in the economy. I could have used “invest”, but you will see why skin in the game is a better explainer. Your skills compound only when you put effort, or skin in the game. Your network compounds only when you put time, or skin in the game. The examples are countless, but skin in the game is necessary. If you quickly remove your skin in the game, the third deep truth about compounding is revealed.

Removing your skin in the game breaks compounding, implying it has to be a long-term commitment

I have realized there are two kinds of approaches to life: short-term optimization and long-term compounding. Short-term optimizers constantly switch between different systems (e.g., career, country, commitment), but long-term compounders stick to the same system. Short-term optimizers look like they are winning in the beginning, but eventually, it is the long-term compounders who win. Once the compounder takes off, it is impossible to beat an exponent. 

You now realize compounders are everywhere  

Look for systems, that allow you to have skin in the game, which require a long-term commitment. Compounding will be possible. Startups, knowledge, habits, reputation all check these boxes. But perhaps the greatest compounder is not too far from you. 

Compound yourself to see real magic

India's 5 Southern States account for: 

- 79% of GCCs
- 66% of IT exports
- 48% of unicorns
- 45% of electronic exports
- 35% of FDI
- 30% of GDP

But only 20% of population, becoming richer+advanced

Taplio

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