If you’re a follower of the tech startups, then you probably know what Spike is. But for those of you who are lost, Spike is a monthly tech entrepreneur and startup meetup. It’s well known as the spot for Sri Lankan entrepreneurs to make connections in a relaxed environment. Happening every last Tuesday of the month, the first edition of 2019 took place this week. And here’s what we found at the first Spike for 2019.
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An Introduction to BOV Capital
The first speaker of the night was Kishan Nadarajah – Venture & Growth Investor at BOV Capital. He opened his talk by introducing us to BOV Capital, which is an active VC in Sri Lanka. Currently, they have two funds. One is a deep technology fund and the other being a digital startup fund.
The deep technology fund is geared toward investing in startups that use the latest technologies to solve big problems. Kishan shared that this is why that follow tech trends. Some of the trends BOV Capital is eyeing on at the moment are Big Data, Internet of Things, Artificial Intelligence, AR & VR, along with blockchain. An example of a company that received funding through this is Linear Squared.
The digital fund is geared toward investing in digital startups. Kishan believes that such startups will change everything in the next 5 years. Working alongside Dialog Axiata, the fund has invested in a variety of companies. However, Kishan shares that a common challenge they’ve seen in this arena is changing behaviors. Nonetheless, he believes it will happen over time.
Kishan added during the Q&A session at Spike that BOV Capital isn’t looking at non-tech startups at this time. He added that some of their previous non-tech investments ended badly. In some extreme cases, the founders disappeared with the money. Nonetheless, for Venture Engine they have an award for social enterprises. They’ve also partnered with social enterprises like Aavishkar as well.
What is Venture Engine?
If you’re a follower of startups in Sri Lanka, then you probably know what it is. But in case you’re lost, Venture Engine is one of the oldest startup competitions in Sri Lanka. BOV Capital alongside its partners originally started it to identify and invest in promising early-stage startups. To date, its invested in 30 companies and has distributed Rs. 2 billion rupees in funding.
This year’s program will conclude on the 21st of February. At its finale, they’ll be inviting investors from across the region. Once the competition ends, the Lankan Angel Network would connect the winning startups with angel investors. But more established companies will be connected with venture capitalists.
However, applicants for the current Venture Engine program is closed. But Kishan shared during the Q&A session that they’ll be exploring running more programs. These could be biquarterly or semi-annually where startups can pitch to investors. But otherwise, they can directly reach out to LAN or BOV Capital.
An introduction to John Keells X
Afterward, we saw Wishanth Wijesinha – Head of John Keells X take the stage. He opened by sharing with everyone the history of the program. It started off in 2016 as a business competition and then became a corporate accelerator in 2017. Some startups that were accepted into the program are HeliosP2P, Direct Pay, Senz Agro, and Grease Monkey.
Wishanth shared at Spike that they’re open to investing in all industries. But they believe they can offer more to those that operate in the verticals of John Keells Holdings. He added during the Q&A session that JKX is open to any looking at significant problems worth solving.
Having explained the basics, he elaborated on how this year’s program would work. The deadline for applications is the 6th of February. After that the accepted teams move into the pre-accelerator stage which focuses on validation and MVP. This ends with a demo day. At the demo day, the teams get a chance to pitch for Rs. 2.5 million.
The startups that receive this would then work towards testing costs, revenue models, and expanding the team. This would be the accelerator itself. Afterward, they’ll also get the chance to pitch for Rs. 50 million. Throughout the program, they’ll offer a co-working space and other support such as legal.
Lessons from an accelerator
“We consider ourselves a startup for startups,” said Wishanth. He shared that over the course of the accelerator, they’ve learned many valuable lessons. One such lesson was applying the same KPI’s to every startup. This didn’t work. A startup aiming at cafes measures it success very differently from one aiming at parents of young children.
Nonetheless, they’ve worked towards building a culture of measurement. Wishanth shared an example from GreaseMonkey at Spike. It had been experimenting with a variety of campaigns. But without measurements, it was impossible to say if these experiments were working.
Another lesson that John Keells X learned was the importance of the Minimum Viable Product. Wishanth shared that this should be built before a startup enters an accelerator. He went onto say that in an accelerator, a startup should be focusing on gaining customers.
Wishanth also reminded everyone, “If you need to pivot then be sure to pivot fast.” And that there’s also no right time to launch. Another story he shared was from HeliosP2P. They had been waiting to launch the platform until it was perfect. But they had learned that no product is 100% perfect. Furthermore, it’s the early adopters that help fine-tune products.
Tips for founders from an active Q&A session
During the Q&A session, both Wishanth and Kishan emphasized the importance of having strong teams. Wishanth shared that common mistake he sees are founders chasing money. When they do so, they fail to focus on meeting customers and building the product. This is why John Keells X looks at whether the team is driven to solve a problem and compliments each other. But Wishanth admits, “You can’t figure this out over an interview.”
Kishan emphasized this with a story of a startup BOV Capital met. This retail startup had a great product but the team didn’t gel well. “Founders working together in unison is important to build a successful company”, says Kishan. This is why he calls founders on a Sunday and if they’re working it’s a good sign.
Kishan also highlighted the importance of having a strong vision. This can attract strong talent especially since startups can’t always pay big salaries. Kishan shared that one of the startups they’d invested in had convinced an ex-Google employee to join because of their strong vision. But when it comes to vision, he believes Sri Lankan founders think small. This is why BOV Capital encourages its startups to think, “How do you get to a billion rupee revenue fast?”
Both of them also emphasized the importance of taking feedback. Kishan shared that BOV Capital doesn’t want to see cocky founders that can’t take feedback. Venture Capitalists are active investors that coach the startups they invest. Wishanth added that this is why John Keells X has the pre-accelerator stage to see how the teams work towards solving the problem.
Additionally, Kishan & Wishanth shared that they don’t want the language to be the barrier to a good idea. This is why they accommodate pitches in Sinhala, Tamil, and English. Wishanth added that John Keells X gets applicants from all across the island. Some even from abroad, whom they try to accommodate as much as possible. Kishan added that Venture Engine too sees many applicants from Galle and Jaffna.
What’s next for Spike?
The 2019 edition of Spike kicked off with some valuable nuggets of knowledge for entrepreneurs. But this is only the first of more to come. Spike happens on the last Tuesday of every month inside Barefoot Cafe. For more information about Spike and to be notified of upcoming meetups, be sure to follow them on Facebook.
