Parallel journeys: Venture Investing is like picking tomorrow’s sports stars

Many of us at Sequoia Capital India are big fans and long-term supporters of Olympic Gold Quest, a not-for-profit that develops athletes who have the potential to win medals on the Olympic stage.

India’s Olympic ambitions have been hampered by lack of access to world class infrastructure, quality coaches and sports health-science support. In 2007, Indian sporting legends Geet Sethi and Prakash Padukone set up OGQ to bridge that gap. A year later, they brought former Indian Hockey Team Captain Viren Rasquinha on board as CEO. OGQ now trains 140 athletes, including badminton star PV Sindhu, who won Silver at Rio and recently took home the women’s title at the Korean Open Super Series.

Last week I met Viren for a cup of coffee and chatted with him about his job and OGQ’s journey. I soon realised that OGQ and Sequoia India share a common goal of finding and supporting special individuals who have raw talent, fire in their heart and a relentless drive to create impact on the world stage.

OGQ seeks out and trains young athletes who can inspire the nation, redefine how the country approaches sport and put India on the world stage. Sequoia India seeks out and supports entrepreneurs who can create massive businesses in new categories, disrupt status quo and ultimately help fuel the country’s economy. In my conversation with Viren, I found much inspiration and many interesting parallels in the way we work.

Focus on a few disciplines

OGQ took an analytical approach early on to decide where to focus its efforts, combing through global and domestic performance data before homing in on five sports where there was a smaller gap between India and the rest of the world: badminton, archery, wrestling, boxing and shooting.

“We debated early on whether to go narrow and deep, or cast a wide net. We looked at medal data from the top 30 nations over the last five Olympics and saw that most of the medals from each winning nation came from five or six sports,” says Viren. “The takeaway is that to win, you need to focus, focus, focus on a few disciplines.”

Sequoia India also believes that the first step to drive results is to take a targeted approach. Ten years back the team functioned as generalists who invested across more than 10 sectors. Over time the fund has picked four sub-sectors that had the potential to create large market cap companies, with capital-light business models that had technology and branding at the core of their differentiation. Sequoia India now has dedicated teams focused on consumer brands such as Fogg, Yellow Diamond and Bira; healthcare disruptors like MedGenome and Koye Pharma; consumer internet companies including Zomato, Byju’s and Truecaller, and enterprise software pioneers such as Freshdesk, Capillary and Druva.

Sourcing talent with an open mind, and an eye for hidden gems

While Viren takes a narrow and deep sectoral approach, he goes wide on talent acquisition. Urban badminton academies might produce budding stars, but to find unpolished gems in traditional sports like wrestling and archery, you need to head out to India’s villages. About 90% of OGQ’s athletes are from rural towns.

OGQ uses district and regional rankings as the prime filter to select candidates. But passion and determination play a role. When OGQ met Shapath Bharwaj, the 13-year-old was travelling 200 km every day to the shooting range and back home. OGQ had very little data on him, but a strong gut feel. “We just felt he was this awesome talent,” says Viren. “Sometimes you are blown away by the fire and hunger, and it makes you throw the norms out the window.” Shapath, now 15, recently took Bronze in the ISSF Junior Shotgun World Cup in Porpetto, Italy.

Viren’s approach to sourcing talent offers insights for venture capital. The idea that you have to look in every corner to find the gems rings particularly true in India, which doesn’t have one ‘Silicon Valley’ style startup capital. And there’s no one perfect founder profile. Our mantra is “different horses for different courses”.

Sequoia India has backed a diverse set of founders including Ritesh Aragwal, a college dropout who started Oyo Rooms at the age of 18, Practo Healthcare’s founder Shanshak ND, who set up his company while still at university — as well as more seasoned entrepreneurs like Loney Antony (Prizm Payments) and Samit Ghosh (Ujjivan Small Bank) who still have more hustle and drive than most of us possess. A lot depends on that X Factor: the sheer audacity, the hunger, and the ability to persevere.

Partnering early

You can do more to foster an athlete, and an entrepreneur, if you start to work with them early on. OGQ spotted Lakshya Sen in a rural part of Uttarkhand state when he was only 10 years old, and brought him to Bangalore to train at the Prakash Padukone badminton academy. Now 16, Lakshya is ranked the World Number One junior player.

“We can have more impact and create success if we can pick up an athlete early, take care of their diet and training and make sure they get the right international exposure,” Viren says. OGQ started working with Sindhu when she was just 14; she’s now a national icon. “It’s been brilliant to be part of that journey.”

And so it goes for VCs. When we can take the first steps with the founder, help them hire the first few people in their company, help open doors to the first few customers, help support their decisions that cement their culture — basically we get to play the part of the ‘founding investor’ — that’s when we have more impact… and have more fun because it’s incredibly fulfilling. The bonds between an early stage investor and the founder are special because of the trust that develops. It can’t be measured in dollars and ownership shares; rather, it’s measured in the innumerable Whatsapps exchanged, the back-of-the-napkin sessions, the tough days endured, the small wins celebrated together.

Nurturing talent takes a village: building trust & ecosystems.

Once OGQ identifies an athlete, the real work starts; identifying a coach, a doctor, a physio and a nutritionist — and building personal connections that will underpin the long-term relationship. It takes months to build trust with a young athlete, many of whom have never left their village before.

“Only when you put in the effort, every day, will they slowly open up to you. And only then will they tell you their problems. And only then can you find a solution,” says Viren. The team feels they’ve scored a success when a young athlete calls them in the wee hours to tell them they’re sick or have an injury. “The 2 a.m. call tells me that trust is there; that they believe we’ll give them the best possible support, in the fastest possible way.”

One of the first things Sequoia India does, post investment, is a ‘Sunrise Session’. The idea is to open the fund’s full network to the founder so that he/she can pick what’s most useful to them. An intro to a customer, help in attracting a Sales Head, a road trip to meet founders of a similar sector in another country. Building a company is like a team sport: in addition to a visionary founder you need a management team who can execute, a Board that plays the role of a coach and a set of ‘specialists’ who can help the company in the crucible moments.

But all of this happens only when there is trust between the investor and founder. That’s why a ‘medal of honour’ at Sequoia is to be the first board member to get the 2 a.m. call from the founder when there is a crisis.

There’s a few more years to go till the next Olympics in 2020. But we will be watching OGQ’s team in the lead up, cheering them on from the side. The passion and determination of these athletes is infectious. We all feel incredibly inspired by their drive.

This column was originally published on LinkedIn.