Ten years ago, when Aditya Agarwal was chief technology officer and vice-president of engineering at San Francisco-based Cloud storage firm Dropbox, he happened to meet Flipkart’s co-founder Binny Bansal. What was meant to be a 45-minute meeting lasted nearly three hours.
“We went deep into everything — technology to the product Flipkart was building,” recalls Agarwal. “It was one of those meetings where you get the sense that there is a lot of potential in a relationship, and I joined the Flipkart board.”
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A decade on, Bansal has joined the early stage venture fund South Park Commons, where Agarwal is a partner.
What’s that?
South Park Commons, or SPC, is named after a San Francisco neighbourhood. It was started in 2015 by Ruchi Sanghvi, who is known for being the first woman engineer at Facebook. She later came to work at Dropbox when it acquired Cove, a company she had founded in 2011, and headed product, marketing, communications, and recruiting.
Agarwal is her husband. Conceived as a collective of founders, researchers, engineers and others interested in startups, SPC went on to raise funds to support early stage founders, but with a twist.
Bansal says SPC is different from other early-stage funds because it focuses on technologists dreaming of building something and helps them get started and try things out. “Something like that does not exist,” he says.
It seems aspiring entrepreneurs can knock on SPC’s doors even before their idea has taken proper shape. Most other funds, even the early stage ones, like to see an idea and some sort of a plan.
That is what SPC means when its founders speak about the journey starting at negative one.
“We are helping founders in this minus one to zero phase where they have no support,” says Sanghvi. “Whenever a founder has an idea that makes sense or has some sort of product market fit, there are tons of people who are willing to invest. But when they are navigating to find out what they want to build, there is no support. And that is what we are trying to provide.”
Industry experts say it is a leap of faith that the people who join the SPC community would be able to launch startups. A lot of founders or technologists who come to SPC come even before they have an idea or before launching a startup. This is the negative one to zero phase.
A top technologist who recently met SPC to understand its programme corroborates this. “There are several incubators and accelerators. But they all focus on the zero to one part of the journey of startups, where they pick the right entrepreneurs who may already have an idea or a very early-stage firm,” he says. “At SPC, the focus is on the negative one to zero phase, which I have not heard of before in India.
Born out of experience
“When I left my job at Dropbox, I wanted to start another company. But when people asked me what I was doing, I was embarrassed to say I was doing nothing. It took me 18 months to tell people that I am trying to figure out what I want to work on next,” says Sanghvi.
So, she started a community of her peers and technologists who were in the same state as her. “We created this environment where it was okay to fail, and as a result we were able to discard good ideas for the great ones,” she says.
Before SPC, she was an angel investor in companies such as Gusto, Pinterest, Paytm, Brex, Figma, and Stemcentrx.
Agarwal came onboard with SPC’s first fund in 2018.
In India, SPC will build on its community’s reputation as a destination for early-stage artificial intelligence (AI) researchers and founders. The earliest members of SPC included future founders of companies like Anthropic and Imbue, as well as early engineers from OpenAI.
“We want to bridge the gap between the AI community here in India and San Francisco, and I think we are uniquely positioned to do that,” says Sanghvi.
SPC typically invests $1 million, which is split into two tranches. Agarwal says it has so far created about 150 companies, which have raised a total of $1.5 billion, and have a collective valuation of more than $40 billion. He goes on to say that 98 per cent of these companies are still alive, which matters given the high rate of failure among startups.
Y-Combinator of India?
The negative one to zero journey of founders is getting attention from others as well.
IndianVCs, a decentralised venture community, recently launched its platform. By tackling challenges in fundraising and hiring, it aims to help in the foundational journey of startups. Founded by a group of former and current venture capitalists, IndianVCs aims to become the “mini Y-Combinator” of India. The aim is to solve the demand and supply of talent and funds.
Y Combinator is Silicon Valley’s startup incubator and accelerator where Airbnb, Coinbase, Reddit and several others took shape. Often called a startup school, Y Combinator has an alumni network whose members are valued at more than $600 billion.
“Founders go through early stage funding only once, so it is not worth their time to become experts on the whole ecosystem,” says Pavithran Chidambaram, founder of IndianVCs. “We have built a repository to save them that time — it’s our job, not theirs.”
The platform offers an investors’ database, a VC job board, and templates to manage fundraising.
“IndianVCs is an incredible community that deeply understands and addresses the unique challenges faced by Indian founders, providing the right support for the country’s emerging startup ecosystem,” says Akshay Kothari, chief operating officer of Notion, the Silicon Valley-based productivity startup.
Rahul Agarwalla, managing partner of SenseAI Ventures, which invests in companies fostering India’s artificial intelligence ecosystem, says Indian VCs streamlines the process of finding the right investors and talent, making it an invaluable resource for first-time founders.
Not so common
South Park Commons is a tech startup community and early stage venture fund
Dedicated to supporting founders, technologists, researchers, and builders during the -1 to 0 stage of their career, when their goal is to figure out what to work on next
Founded in late 2015 by Ruchi Sanghvi, the first female engineer at Facebook and former VP of Operations at Dropbox
Sanghvi was joined by Aditya Agarwal, former CTO of Dropbox, with the founding of the SPC Fund in 2018
The community has existing locations in San Francisco and New York City
Bengaluru will be the community’s first location outside the United States
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