Multi-asset class investment firm Sharrp Ventures is likely to invest around USD 20 million in the next 2-3 years to help startups grow and scale, its managing partner Rishabh Mariwala has said.
Sharrp’s focus would continue funding startups in consumer, consumer-tech and health-tech segments, he added. The firm, which manages the proprietary capital of the Harsh Mariwala family the founding family of Marico Ltd, has so far funded 23 startup ventures with funds worth around Rs 500 crore. It has delivered top decile returns, including early investments in companies such as Nykaa and Mama Earth. “It is a significant quantum. We are open to investing around 20 million in the next 2-3 years,” Mariwala said in an interaction with PTI.
The firm aims to back the strong entrepreneurs who are building long-term sustainable businesses and have unique propositions, he said. Mariwala noted that it is just not about funding startups but also about adding value to them, such as opening networks as well as access to retailers online, among others. “We are focussed on the consumer (segment) since we understand the consumer and the nuances around what the consumer wants and needs. Then it is easy to evaluate and help them (entrepreneurs),” he said. Therefore startups in consumer, consumer-tech, sustainability and healthcare, and within that sub-sectors, such as pet care, health, insurance and other marketplaces, would be the focus area for funding, he said.
“So far, the firm has had a good run…within consumer and consumer tech, we looked at multiple investments in beauty care, in food, in mother babies, alcohol, among others,” he said. Sharrp has funded around Rs 500 crore to as many as 23 startups at multiple points from seed capital to Series A, and Series B rounds of funding, he said, adding that “the entrepreneurs use the platform to scale the businesses and when businesses have scaled, the other investors have come on board”. “When the businesses are young that is where we play a significant role,” he emphasised.
The firm expects some 3-4 startups going for listed in the next 3-4 years. According to him, the listing of a startup is a function of scale. The ventures which have passed the Rs 600 crore (in business) mark are ripe for listing. “Those are the ones who are excited to list and there is equity (as well) for everybody,” Mariwala said, adding Sharrp expects another 3-4 startups funded by it to go for listing in the next 3-4 years. Beauty and wellness product firm Nykaa, in which Sharrp was one of the investors before its IPO, made its debut in the stock market in November 2021.
When asked how long an investment firm should remain invested in a startup business, he said, “We are a long-term patient capital. We believe it (any funding) is a long-term horizon for us”. It (the decision to exit) is a function of how big has the business grown and the ability to understand the business, he said, adding “The challenge is when a startup business is not listed, when it is still under private equity. That is where we don’t want to exit”. It takes about 8-10 years to build a brand and “that is the time one should look at exit”, he said.