In the current context, how is IvyCap working with its portfolio companies to survive the crisis and adapt to exploring the opportunity?

The second is a quote from Martin Luther King :

“The ultimate measure of a man is not where he stands in the moments of comfort, but where he stands at times of challenge and controversy.”

How our entrepreneurs are responding in these times of crisis, has never been more critical to the success of our ventures.

The crisis has led to a difficult set of choices for our companies. They are torn between the conflicting challenges of Lives vs. Livelihood, Short term Sustenance vs Growth and Building talent and capacity vs Rightsizing. IvyCap, through its ecosystem, has been actively working with our portfolio companies in identifying priorities and helping founders navigate through these difficult choices. We have had periodic sessions with experts ranging from BCP experts, lawyers, HR practitioners, Industry experts, technology experts, Investors and marketing specialists. We have conducted working sessions to explore synergies within our portfolio, and in reviewing and discussing business plan choices with our portfolio companies on a weekly / fortnightly basis.

In these difficult times, while making choices, our companies are giving top priority to the health of employees. In addition, they are prioritizing sustainability of cash for the next 12-15 months as the most important business objective.

Prioritizing the health of employees, IvyCap and some of our companies started working from home even before lockdown began. Some of our portfolio companies also started typically BCP practices like breaking into teams. During the lockdown, the leadership of some of our portfolio companies has been running sessions to ensure mental and physical health of their staff. Gladly, none of our portfolio companies or the IvyCap team have reported any COVID positive cases or have had the need to quarantine.

The other critical challenge is to ensure cash sustenance for next 12-15 months. While quite a few of our companies, such as Purplle, Bluestone, Biryanibykilo, Ft cash, Singularity, Convosight and some other Fund 2 companies, have raised recent rounds and are in a very healthy position. Some of them were in the middle of a fund raise or were planning to raise one. Some of the others such as Clovia, Bluestone, Eshakti, Leixir have raised or are in the process of raising bridge rounds or tap alternate sources of funding.

Irrespective of their cash position, our companies have been very proactive and nimble in cutting cost, focusing their operations, and saving cash wherever possible. Focus of business, verbalising the cost structure, keeping fixed costs lean has been the cornerstone of the cost reduction strategy.

As a fund, our investment criteria include unit economics and capital efficiency. Therefore, all our companies manage to grow with a relatively low burn and fixed costs compared to their peers and most other startups, in general. This, in addition to the cost cutting and fund raising efforts of our companies mentioned above have put most of them in a cash position to tide over the crisis. While the situation is still evolving and the crisis is far from over, we are increasingly confident that a majority of our companies will be able to tide over cash flow issues and achieve their objective of surviving the crisis.

As the Chinese character of Weiji and Jihui remind us, every crisis also presents an opportunity. One clear and obvious opportunity is that in the medium and long term, the world will digitize even faster. Digital companies which are competitive in the market and are considered essential to their customers will stand to gain once they come out of the crisis. We are likely to see a world where consumers are buying more online, spending more time on social media, using digital tools to conduct their finances, and corporates are automating at an even faster rate than before. Our portfolio mix is ALL digital both on the B2B and B2C side. We are therefore excited about the prospect that many of our companies will be beneficiaries of this long term secular trend.

In addition to the above trend, many of our companies have shown tremendous nimbleness, agility and entrepreneurship in using this time to strengthen their business and tapping on opportunities presenting themselves. Such stories amongst our founders are widespread and inspiring. In a short write up I am forced to select just a few examples of this entrepreneurship within our portfolio companies. Clovia was able to quickly repurpose its supply chain to sell PPE kits and masks. This gave them short term revenues in the month of April which was a complete lock down model. Pharmarack, our Pharma platform was able to scale up its fulfilment revenues rapidly and is being used by the governments of Gujarat and Maharashtra to track essential medicines in trade. Convosights, our social media AI company was able to leverage its listening and AI platform to deliver a COVID specific offering to larger brands. Vinculum has set an example by pushing cross border feature of its platform by selling PPE kits and other cross border between Asia and US. It has also been nimble in targeting offline brands which want to go online using Vinculum’s platform. Biryani by Kilo is also worth a mention for its proactive stance of adding hygiene as a differentiator and bringing best practices in hygiene to food delivery in India. Other than contactless delivery, they have started offering a live feed of the kitchen for their consumers. They are also exploring technologies like UV disinfectants to set a benchmark in hygiene and give their consumers confidence that, in addition to fresh and authentic food, they are delivering food safely.

Our founders have already demonstrated that they are passionate and clear about their purpose. Resilience, Agility and Ability to soak in pressure are very important trait in these times. In this time of crisis, the lessons in leadership and entrepreneurship are many from our portfolio. Some of the best outcomes are visible from founders who are able to carry their teams along and align them to their sense of purpose. They are therefore able to not only survive, adjust their business plans and maintain a razor focus on survival, innovation and recovery now.

We will get you more progress and development information about the recovery path of our companies next time.

I am going to end with a quote from “A New Earth – Awakening to your life’s purpose” which best represents the current crisis.

“When faced with a radical crisis, when the old way of being in the world, of interacting with each other and with the realm of nature doesn't work anymore, when survival is threatened by seemingly insurmountable problems, an individual life-form -- or a species -- will either die or become extinct or rise above the limitations of its condition through an evolutionary leap.”

On behalf of IvyCap and our portfolio companies, I wish you and all your families and loved ones the courage to rise above the limiting condition and make great efforts for an evolutionary leap.