Investors look at co’s track record: Vinod Keni

Source: The Hitavada      Date: 30 Jul 2017 08:42:07


Business Bureau,

OUT of the ten companies in which a investor invests, six companies will fail to return, remaining four will be able to pay partly and only two companies are able to return the full loan amount, noted Vinod Keni, Partner at Artha Venture Fund, Executive Director of MyCFO, Co-Founder and Partner at Peachtree Management Advisors and
Chair Fintech SIG.

He was speaking as the key note speaker at the TiE Nagpur’s ‘Impact Series 2017’ workshop on ‘How companies are valued’, on Saturday at Chitnavis Centre.
Keni, shedding light on ‘Know what does valuation mean to your company? What your company is worth? How do you measure your company’s growth?, clarified that an entrepreneur must see that he was adequately funded, not too much or not under-funded. Keni, who is an accomplished corporate finance executive, investment professional, entrepreneur and advisor, also shared his experience of success and failures of companies.

He said: “There must be justification to funding. An entrepreneur must make valuation of his project. He must have complete financial planning and must be thorough with the returns he will get after a period of time.” Explaining the meaning of Internal Rate of Return (IRR), he said, “It is not a rocket science, but a simple compound interest which one has learnt in his primary school. An entrepreneur must be well aware of the growth plan of his company and returns which he will get in due course of time.”

Counting on his domain expertise of industries like technology, health care, outsourcing, services, food services, hospitality and manufacturing, Keni said: “Investors look at the company’s customer track records. Investors also make pre-money valuation and post-money valuation before funding a company.” He mentioned that investors looked for returns above 25 per cent.

“An entrepreneur must visualise for himself that the rate at which he is borrowing, can he return at that rate and earn for himself too. An entrepreneur must always ask to himself as to how much capital he needs. He must visualise at every point. To build a business of Rs 500 crore, he must raise a capital of Rs 100 crore,” Keni suggested.

Being a member of the Indian Angel Network (IAN) and Co-founder and Director at Atlanta Hitch CEO Council, without use of any presentation of excel sheets, Keni explained the subject in a very simple language.

He said: “An investor discusses financial plan of the company before funding. He also matches it with public limited and private companies.” Shashikant Choudhary, President, TiE Nagpur, Kartik Kale, Dipesh Ajmera, Kartik Borikar, all charter members were present at the workshop. Chenali Bisen and Sanket Bhat worked hard for success of the event.