It was in this month fifteen years ago Randy Williams founded angel investor community Keiretsu Forum in San Francisco East Bay. Keiretsu Forum, arguably one of the largest angel networks with 39 chapters and around 2,000 members across three continents, entered India early this year. Starting with Chennai, it opened its Bangalore chapter last week and is slated to launch in Mumbai shortly. Williams spoke to VCCircle about Keiretsu's plans and investment approach in an exclusive interview. Excerpts:
Now you have two chapters in India. What is the roadmap here-on?
We are very impressed with the growth thus far. We are in no rush. We don't move to any community unless we find local leadership. We are looking globally for 15 new chapters. We may contract one or two of them shortly. We are waiting for leaderships; two or three individuals per region. What we are essentially looking at there must be a large entrepreneurial community and there must be a large investor community. We are going to take it very slowly. We are probably going to have two more chapters in the next 12 months.
Different angel groups have been active in India. How do you differentiate yourself?
We are looking forward to invest alongside top angel groups. Our differentiator is we look at everything. We feel that there could be downturns in any given market. The blessing we have is we look at all around the world. We look at asset classes that might emerge on a daily basis globally, from Prague or from Singapore. We think globally and act locally. We definitely look at investing globally.
From an entrepreneur's point of view, what advantage do you bring to the table?
We are looking for the Bangalore and Chennai companies to come to the US after getting capital from the local chapters. If they don't get capital here we may not necessarily look at them. I mean, that will be a big validator for us. We look for them to travel to America and we will help them with commercialisation, additional resources and capital. Fortunately with 2,000 members globally we have a lot of resources.
What is the range of investment the Keiretsu members make?
A region might do between a million and a million and a half. If you need additional capital come back in six months, raise more money or travel. We like our companies to travel they will hopefully get more resources and capital when they travel.
How do you select companies?
We have a committee system. When a company comes we send them to a committee. Even in California, typically 50 companies apply, 50 go to committee system and top ten would be chosen by a management group. They come to a screening there just a week before the forum. Ten companies come to pitch to us. There will be 15 minutes pitch and half of that will be for Q&A. We close the doors, we discuss the companies and we finally vote. Voting is critically important. Typically 60-75 per cent of the companies get funded if they make it to the forum. We don't want entrepreneurs to go through the whole process and not funded.
Can you tell us about the track record of Keiretsu Forum? And what are your priority sectors?
We are celebrating 15 years this month. We have helped 765 funding globally. Typically a region reaches critical mass when they fund 25-30 companies. We expect that in Bangalore. We had an IPO last year. Generally a lot of our companies move to M&A. We like technology product companies, real estate, cleantech companies etc.
What kind of investors do you want to bring on board?
Obviously people want to protect their money. We provide a platform to provide a secure way of investing, a process and a structure to protect our investors. We look at investors who generally have been on the entrepreneurial space, have great empathy for what other people do and can help them with resources and capital. We are a platform to minimise the risk. There are lot of opportunity in what we do and lot of risk. We try and minimise the risk through Keiretsu's quality of due diligence. It is an invitation-only community. We want to be careful.
What is your view of the angel investment scenario in India?
We are getting tremendous response. However, only our local leadership can comment on the specifics. To add to that, one of the reasons why I am here is we have 300 members in California and over 300 members in Northwest and lot of them and lot of them ask me how come you are not in India. And here we are.