Sameer Guglani and Nandini Hirianniah, the team that built MadHouse.in (which was later acquired by seventymm) have started a YCombinator like venture called Morpheus Venture Partners, an investment firm mainly interested in early stage startups.
Here is a quick QnA with the duo on their plans related to Morpheus:
What kind of startups are you targeting? College grads? Boostrapped?
Morpheus is open to work with all kinds of start-ups. However, the following would be our focus area:
- Early stage start-up teams who have not received any professional funding so far. (Professional funding comes with good amount of advise, mentorship and contacts)
- Teams which are still in idea stage and have not started of as yet.
- We’d prefer start-ups with more than one founder (will help single founders find co-founders) and founders who just refuse to fail
- A team that can bootstrap or has bootstrapped, as that is an essential ingredient of an entrepreneur and a start-up.
- An idea/product/solution that is solving a real problem and targets a large market. Team should have an open mind to morph their idea, as market realities are often very different than the assumptions made while designing the product/solution.
Avg. Investment size that you are interested in?
Our primary value add to the startup teams is the advise, mentorship, guidance, access to the right network, creating opportunity to meeting relevant people, team strategy, product strategy, launch strategy, fund raising strategy (intros and more), getting the right advisers onboard with the right kind of terms, etc.
The most important thing we do is work with startups on their ideas. We’re entrepreneurs ourselves, and we’ve spent a lot of time figuring out how to make things people want.
The first 12 months are the most critical period in the life of a start-up, they are also know as the “valley of death”. Most people save money for a year, quit their jobs and take a plunge into entrepreneurship and if things don’t go well in the first they will have no choice but to go back to jobs. It is during this period that they require non-monitory investment in terms of guidance in doing it right and doing it well. Morpheus will provide them with the required support to help them validate their idea and roll the venture out.
However, we are evaluating an option of raising a small fund and making very small seed investments into the companies. But even with that, money will remain a very small portion of what we bring to the table. Our goal is to get the team through the first phase. This usually means: get it to the point where the team has built something impressive enough to raise money on a larger scale.
As a mentor to several startups, what are the industries you are most bullish about?
Morpheus is bullish about team which can solve real problems and which refuses to fail, come what may. We would like to work with start-ups on all verticals and not just limit ourselves to a technology or a web-based initiative.
Suggestions/Tips to young entrepreneurs?
- Look for problems around you, and think about solutions that are much better than the existing ones
- Remember that the power lies with you, the entrepreneur.
- Think big, dream large.
- Listen to your customer, as he’s the one that matters and make every penny work for your customer. Rest will follow!
- (Our favorite advice): Be fair to every one, people who you work with, people who you meet at conferences, on the blogs and otherwise. Startups need a lot of help (and all kind of help) from people around to build their dream product/service and if you are fair to people, they will come forward and help you.
Anyone who is looking to contact morpheus venture with regards to more details can contact on sameer AT morpheusventure DOT com or nandini At morpheusventure DOT com
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“Teams which are still in idea stage and have not started of as yet.” This truely makes India’s YC
I think these guys should go and first excel themselves before offering advice and mentoring to fellow entrepreneurs. India is full of cheap advice and mentoring, after all that is our national pass time. Almost anyone who has spent a year at a startup or founded something, how much shitty it might be thinks he is now in a position to advice. With so many people capable of giving good advice, I wonder why aren’t their any great Indian companies yet?
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‘Our primary value add to the startup teams is the advise, mentorship, guidance’…
If so, what’s Morpheus’ interest in new venture which is going to be created ? Is it ‘equity participation’ or smething else ?
After being in a TBI for almost 2 yrs, I can confidently say that Right mentorship and guidance are as much valuable as funding to a startup. But no free lunches..right ?..
So wht’s going to be the range of Morpheus Stake ? (eg: YComb has min 6% stake in all incubatee cmpnies)
@ Ashish: You should hve covered this point in the interview.
Leo and others:
I will ask Sameer/Nandini to reply to all of your qns. To set the context, I met Sameer yesterday to discuss their plan (esp. equity stake etc)- but since you have raised the qn (I am glad about it), I will let Sameer reply to this.
@Rohit – Maybe you didn’t read the entire post – the duo sold their co. to seventymm, so they have ‘been there, done that’
-Ashish
@Ashish: I read the entire post. But is that all it takes to be an authority – setting up and selling something? Building a sustainable business, how about it? Scalability? Innovation? Organization building? How many people in the world know Madhouse? I don’t think they have been there, done that. I just wish they had build up on their lucky break (sell out) and started again to build something truly great.
@ Leo. morpheus will take stock in the startup startup, from 4-8% of it. Depending on the what stage the startup is in and the value morpheus can add.
PS: What’s TBI?
@ Sameer : Thanks for the info. Btw, TBI stands for TECHNOLOGY BUSINESS INCUBATOR (setup by Department of Science & Technology, Govt.of India)
@Leo: let’s talk offline, I would keen to understand the TBI model. Drop me a line at sameer AT morpheusventure DOT com
Hi,
How can I contact Mr.Sameer regarding our startup.
Thanks
This is interesting. But… 4-8% is more than a “regular” adviser to a startup would get. Esp. without any investment. Will Morpheus also be providing infrastructure or something to justify the high %?
Also, would it be just the two principals advising? How many companies will they take on?
I am happy to know that someone has started this kind of Venture. I recently started a company after working in IT for 10 yrs (8 years in Satyam) and many a times I felt a need for mentor who can support us in our ideas. But I have a question here…how does you guarantee that the ideas you reject will not be shared. May be same ideas are thought by someone else somewhere but till the time I know it I need to take care of it.
@Rohit: I feel even one experience of ‘been there, done that’ should be good enough to help others. It’s always valuable. How much equity you shell out for that is your business decision?
Harish
Karmanya