Bengaluru: Cisco Chairman Emeritus and serial investor John Chambers, who has two domestic companies in his portfolio, says India is emerging as a popular location for American startups who want to set up a second centre. In Bengaluru recently for the opening of cloud data management company Rubrik’s new research and development (R&D) center, Chambers--who is also a Rubrik investor and Board Advisor-- explained why he was bullish on the Indian startup ecosystem and his investment strategy. Edited excerpts:
As an investor, what do you look for?
I look for four characteristics. One is, markets that are in a business transformation, enabled by new technology. Every market is starting to be changed by the cloud and the cloud moving to the edge. Internet of Things (IoT) is huge, and the security and the cyber security implications for that. The ability to move Big Data around with the protection of privacy and government compliance is interesting. The second thing I look for, is the CEO. They have to be, in my opinion, a CEO who has a chance to become a world class CEO, but they aren't yet because their companies are just starting to grow. Somebody who wants to be coached, and I'm more of a strategic partner with these companies. They can use my experience. The third thing I look for…I'm always customer-driven. All the companies I acquired at Cisco, the customers told me to do it. So I really listen to customers view on it, look at what the opportunity overall is, on it. Then I see if they're really close to an inflection point, and whether they can be the number one or two player and I'm really interested in number one, with over 40% market share on it. And then I look at the make-up of their team and their Board.
How many companies have you backed so far? What kind of work are they doing?
Eighteen, about $100 million invested, all personal money. These companies are heavily into the transition - so around cloud, a large amount around security companies and security. The focus on customer experience is huge. Artificial intelligence (AI) is the core of it. My top AI startup out of New York got the whole graduating class of MIT PhDs in AI. And SparkCognition, down in Texas recently did a joint AI project with Boeing. Large companies are suddenly looking at small companies to be able to really do their innovation together. Then there’s Aspire Food Group, that’s involved in how you use Big Data, cloud technology, and robotics to grow crickets, which I think will be the next form of protein.
Which Indian companies have you have invested in? What do you think about the startup ecosystem here?
There is Uniphore (speech recognition solutions company); it was a very small startup with customers primarily here in India. Now they’re $145 million (valuation), the prediction is that they'll be a unicorn within 18 months. Their second major centre of excellence will be in the US. One that's about two years behind that is Lucideus (a cybersecurity firm). Saket Modi (co-founder and chief executive of Lucideus) has dominated the Indian market, and is learning to scale the organization.
What is exciting is, almost all my startups are coming to India for their second location. Sprinklr is a top company, a unicorn, on social media and customer experience management. I was talking to them recently on establishing a huge centre of excellence here. You see Rubrik’s doing it, several others will follow shortly. India is becoming a startup hub not just for startups but also American companies wanting to have their second centre here. Not big companies, but the startups and that's where the job growth occurs.