Prantik Mazumdar: Professional Cofounder Breakups, Angel Pitch POV & Tough Times - E144

Prantik Mazumdar is an award winning Entrepreneur, marketer, venture investor and acts as a Digital Transformation Catalyst in organizations to drive sustainable change and impact. He started his entrepreneurial journey with Happy Marketer in 2011 where he spent a decade building & scaling up one of the best and most awarded independent digital marketing services firm in the region that served brands like Standard Chartered Bank, Income, Great Eastern Life, Royal Brunei Airlines, Coffee Bean & Tea Leaf, Starbucks, Ping An, Grab, Shopee, GoJek, Kimberly Clark, PropertyGuru, PegiPegi, Starhub, Singtel, Nanyang Business School, Kaplan, INSEAD amongst many of it's prestigious clients. In February 2019, he had a successful exit when Happy Marketer was sold to an American digital enterprise called Merkle, which is part of dentsu International, the largest Japanese advertising conglomerate.

He is currently serving as the Managing Director of the CXM Group at Dentsu Singapore. Apart from his corporate role, he is an active angel & venture investor, mentor, advisor and speaker through organizations like Quest Ventures, Tie Singapore, HealthXCapital, NUS Angel Ventures and is an Entrepreneur-In-Resident at INSEAD.

Jeremy Au: (00:30)
Hey, Prantik, so excited to have you on the show. It’s amazing to see someone who is not only a successful founder in the marketing-tech space, but also a serial angel investor. I can’t wait to hear your story and your insights, Prantik.

Prantik Mazumdar: (00:50)
Thanks a lot, Jeremy, it’s an absolute pleasure. Heard a few episodes, good to be here. Looking forward to our conversation.
 

Jeremy Au: (00:59)
So, Prantik, tell us who you are.
 

Prantik Mazumdar: (01:01)
Yes. So I’m Prantik Mazumdar, the managing director of the CXM group within the Dentsu Singapore office. So I look after three brands which fall under the customer Experience Management group including Happy Marketer which is the company I co-founded and, eventually, we had an exit with Dentsu. So it’s an interesting phase where I’m looking after three brands, including the little baby that had kind of been part of for about a decade, outside of that, as you rightly said the last couple of years, I’ve had a good opportunity to kind of look at the Singapore or the Southeast Asia startup ecosystem. So I have had a good opportunity to invest either as an Angel investor in some of these startups. In the region or help them as advisors in various cases and, as you rightly said, in three of the VC firms I do, I have come in as a limited partner. So that’s a bit about me professionally. On the personal side, I have a 5 year old son. My wife is a doctor at NUH.
 

Jeremy Au: (01:59)
Amazing. How did the entrepreneurship bug first bite you?
 

Prantik Mazumdar: (02:03)
It kind of bit me or kind of got introduced to me probably in 2003 when I was in NUS. So it’s been 20 years for me in Singapore and I’d come to pursue computer engineering, a bachelors degree in the School of Computing. Whilst doing that, we got to hear that NUS was kickstarting an initiative called a minor in Technopreneurship, so the word was a mouthful. Had no clue what it was all about, so we just blindly signed up, sounded cool as a young kid, and I think that was an eye opener because it was a six module course taught by some fantastic professors from Singapore and from overseas for the first time. It gave us techies an idea of how do you build a product? How do you scale a product? How do you manage finances? Something I even didn’t have any theoretical knowledge about. So I would say that’s the very first time I got a sense of what does entrepreneurship really mean? And probably a peek into the Singapore ecosystem and how the different members of the ecosystem operate. So probably 2003, nearly 18 years ago.
 

Jeremy Au: (03:08)
In what forms did entrepreneurship happen for you?
 

Prantik Mazumdar: (03:11)
So yeah, I think when that exposure happened, I think clearly there was an interest and a curiosity to explore that path. I did want to take up the NUS Overseas College program to take that one notch higher. Unfortunately, unlike my eventual co-founder, Rachit, I didn’t make it to NOC, but I kind of stayed close to that group. I kind of started vicariously living that journey through them, but then I think the big trigger point happened when I started my career at what was then called IE Singapore, International Enterprise Singapore, part of the Ministry of Trade and Industry and I was deployed in the ICT Industry Group and it had two genres. Back then was to help large telecom tech companies like ST Electronics, ST Engineering, Singtel and the fascinating part was I was also given the responsibility to drive initiative for internationalizing startups. So there was a bond global startup initiative, a collaboration between ID, IE Singapore, kind of as part of Intelligent Island 2015 back then, the government initiative and I think that was a game changer because, of course, I was part of the government machinery, but I got a very good breadth perspective of one of the different kind of startups in Singapore. What are their challenges? What markets are they looking? So I think that’s the first time I kind of got a sense that, hopefully, one fine day I get a chance to give this a shot, but I spent 3 ½ years there. I did not directly jump into kind of starting something on my own, but I did leave IE Singapore to join two SME’s, a Singapore based brand consulting firm called Strategy COM which sent me back home to India to help as a country manager to expand. That’s the first time I was in a private sector, small, medium entity and I had to sell. It was a big struggle. I eventually came back to Singapore heading sales for an Indian digital marketing company called Princeton. That was fascinating because I got to sell by day and deliver by night, very entrepreneurial or intrapreneurial and I think the entrepreneurial opportunity happened to me when my good friend and the original founder of Happy Marketer, Rachit, who’s also from NUS, he reached out and said, look, you’re doing this for someone else. Why not get together and do something together? So, my official entrepreneurial journey began on 1st November 2011 when I came in as a co-founder and managing partner at Happy Marketer.
 

Jeremy Au: (05:39)
What was your first founder experience like?
 

Prantik Mazumdar: (05:46)
It was quite scary, to be honest. It kind of gave a sense of freedom because obviously there were no more office cards. There were no office, laptops, etc. At the same time. So to be honest, it took me a good six months between my pin storm roll to kind of convince myself, my family, to come and just rationalize why am I doing this and what am I looking to achieve? And once I jumped on board, I think it was exciting and but rather quite nervous and I had this itch to want to prove to myself that look, I can make this happen because I knew it’s not just me. It’s obviously there’s a main founder, Rachit, and he’s a good friend and he's invested so much time and effort to kind of germinate this. So there was a sense of responsibility, yet a very interesting nervous energy. That OK, I gotta do something. I gotta do something for myself, my family, as well as for Rachit, my friend and co-founder. But very, very exciting times. I think timing wise, Singapore, this is the time some of the global VC’s were coming in the startup ecosystem we had just heard of one or two exits. So Darius from NUS had, and a bunch of other friends, had exited their first startup. So it is just about beginning to shape up. Jungle Ventures we had a few friends there they were beginning to set up as well. Of course, there were other VCs setting up shop. There were lots of government, one for one. The NRF initiatives began coming in. So there was a bit of noise, it kind of gives you confidence that, hey, this is not completely ludicrous. This is worthwhile exploring, but a very, very good feeling.
 

Jeremy Au: (07:08)
What did you learn from being a founder?
 

Prantik Mazumdar: (07:17)
Yeah. The first 90 days. I remember that vividly. I think two or three things that come to mind. I think the three things that come to mind. The first 90 days is A, how do I ensure that I kind of seal my place in the entity and make a mark both in terms of my own confidence as well as to kind of gain some respect. So I think I had set a target that I am going to help the business grow from X to Y. In that three to six month period and I'm glad business started coming in and had some experience with my previous company in a similar domain. So that helped but that gave a lot of confidence that I could make the rain happen. I could bring in some food on the table, that was exhilarating. The second is I think a sensation or realization that it is not just about sales, it's also about how do you kind of deliver and how do you win a client’s trust and love? How do you deliver so that they keep coming back? So, repeat sales, good NPS scores I think was the second thing on my mind. And the third thing which is I think stayed all the way through is making payroll. I think it’s very humbling that it’s not just about you and your own rice bowl, it is maybe…I mean eventually we had 60 people. I know in the early days, maybe six or nine people, but they’re counting on you or the leadership. So I think those are three things that I’ve always stayed true to myself, that it’s about business development, growing the brand, building that trust so that you can create a systematic, repeatable, predictable sales model where business starts flowing in either through direct or through partners. Second is how do you ensure there is decent delivery? Because, again, that adds up to the brand that you’re trying to build. I was having come from the world of brand marketing. I was always cognizant that that’s the way to go. You want to build a true, genuine, reputable brand inside and outside the organization that’s sustainable that creates a decent fly wheel and I think the most important part of my journey to be honest, Jeremy, has been about the people. We’re a services business, not a VC investible. How do we stay profitable? How do we treat our people well, to create a culture that’s fun and interesting to kind of innovate together. But at the end of the day, it’s about seeing those people do well at their careers, whether within Happy Marketer or many of them have gone on to join Facebook, Google, Flip cards, so on and so forth, some have joined VCs. It’s just good to see people that you work with flourish in life. I think that sentiment is quite dear to my heart.
 

Jeremy Au: (09:36)
Yeah, Happy Marketer grew over time and I know there are some tough times too. What were some of them?
 

Prantik Mazumdar: (09:46)
Yeah, absolutely. It’s a decade long journey. Lot of tough times. I think again two or three that keep flashing into my memory. I think one is managing cofounders and I think in our ten year journey we’ve had a couple of instances where along with Rachit and me, there was another co-founder. Eventually he decided to move on. So managing those conflicts or transitions head on. I think in our Asian culture it’s not really…you’re not really prepared for it, to be honest, dealing with conflicts. I think we always want to save face and try to kind of manage those in a diplomatic manner. But sometimes you can’t. So I think those hard conversations, cofounder conversations, I think that’s one. Very hard, but there’s no two ways about it. Dealing it head on, having hard conversations, subtypes getting in 3rd party people to kind of just kind of arbitrate in a more peaceful manner so that’s one. The second is cash flow. Like I said, we had no funding, so it was all about profit first and managing cash flow. So I think the other scary moment in our business midway was there was a large education client which eventually did very well for us, but the challenge is it kind of became nearly 40% of our revenue and I don’t think we adept at managing risk well. So we were very happy the account was growing, money was flowing in, but one fine day after five years the client decided to move on and I still remember July 5th, 2015 and that was a shocker because I obviously heard the news from the client at a coffee shop. I had to come and break the news. It obviously sank a lot of hearts, but I think, again, it’s the beauty just the way we are going through the pandemic. I think such crisis moments, it shows who are your real loyal supporters and how they kind of galvanize and come together. I think, again, good lesson. It got us together and thereafter, we never allowed any one account or client to kind of grow more than 20%. I think cash flow and managing risk was the second lesson. The third, well, tough time was again, I think, related to cash is non-payments. We’ve had quite a few unfortunate cases where, again, mostly in the early days where clients did not pay or did not pay on time and heart-breaking because the work is done, you trust the system. Even in Singapore, the law of the land is so good and it’s enforced so well. But you realize in many cases as a service provider, you’re unable to bring the client…unable to take legal action. I think I still remember there was a day sometime in the month of August in 2013 when I think we only had about $200-$250 in our bank account. We wake up to an OCBC SMS in the morning. That was rather scary. But, again, I think it’s those lessons which it’s hard to learn in the bookish way. But it's those lessons that kind of make you realize that business is so much about…scaling a business is so much about more than just selling. You know, I came from a sales and marketing world, and I used to presume that if you sell, you close a contract, the job is done, but you realize that’s when the job begins and managing people, delivery, managing cash flow, managing risk, these have been interesting, tough lessons over the last decade.
 

Jeremy Au: (12:42)
Amazing. Lots of lessons there. Let’s talk about cofounder conflict. They say prevention is better than cure. How would you go about preventing cofounder conflict?
 

Prantik Mazumdar: (13:04)
I think that’s a good adage. In many cases I think prevention is better than cure and I think deliberate, I would just add the word deliberate in front of that, deliberate prevention. I think as we have matured, Rachit, myself, there are a few other colleagues who have, today, become partners. So I think the way we have managed it is, again, to put all cards on the table, not to hide anything in the kimono under the kimono, just go all out. Be open about what are your expectations as a partner? What is the organization’s expectation and as much as possible documented through an MOA or through a legal contract, even remuneration, to be honest, when we began, we just had a piece of non-legal paper between us saying here’s the document, here’s the shareholding, but that’s about it. But as you mature, I think what I advise to all the companies that today either if I’m involved as an investor or an advisor is get that paperwork going. The good thing is in Singapore, law of the land is very sacrosanct. It's very well respected and enforced, so make the most of it. Put it out in the paper. One is the legality part of it, the other is even the non-legality part of it, which I think is critical and I think that comes, again, just like personal relationship, it comes through conversation and over time. I’ve always believed that cofounders need to be conjoined with values, similar values, but skill sets need to be complementary. That’s one. The second is I think people have to be OK. Just like in marriages that people change, circumstances change. So every maybe six months to a year, we literally gather and we have a conversation saying, hey, are you guys still in this or your personal plans may have changed? Are you guys looking to move out? It’s important because in a globalized world, there are so many options, peoples, desires, plan, circumstances can change apart from the legalese. I think this is what’s probably more important is if there is that healthy trust and open conversation to deliberately discuss this without fear of being kind of criticised or being judged, it’s easier said than done for sure, but I think there is no two ways than going about this process in a deliberate manner and sometimes absolutely bring in external help. We’ve done this, we’ve gotten external bankers or external lawyers or corporate secretary folks to kind of just guide us because, again, we don’t know what we don’t know and none of us come from a legal background. So time and again, we kind of get in people to advise us on succession planning, on legal structuring, so on so forth. I think I would sum it up at that, you know, legally document stuff. Deliberately have a structured rhythm to talk about changes and preferences and getting external help.
 

Jeremy Au: (15:32)
Let’s just say we do all this prevention work, the company is growing, but the founder is not. How would you articulate that conversation and process?
 

Prantik Mazumdar: (16:06)
Yeah, we went through that. I think, at one point with our third founder we had. He reached out and he said, look, I don’t think I agree or I’m in alignment with the direction of the company or the growth path that the company is kind of decided on. Initially took a while. It was a bit of a shock, to be honest, because it was the first time you kind of always envisaged and dream that just because you started something together, you'll see through the whole course, but that's not life. And I think once we acknowledge the difference, we kind of broke it down as to what is different. First we tried, can we try and make amends or look at this differently, but once we realize that it's probably everyone's best interest to kind of separate and move on. Then came the harder part of how do you deal with equity and I think that's something we've learned the harder way that because we hadn't done a lot of things deliberately, we learned the hard way that because there were no agreements in place, no exit clauses, etc. I think eventually as three friends we said, hey, OK, you own X amount of equity. Another question is what's the value of this equity? We didn't have a third party validation or no investments that was very hard because, obviously, suddenly you are on two opposing camps. I would obviously, as the buyer, I would say hey, the value is X and you know as the seller I would say it's much more. So that's when we got in a third friend, a lawyer, and someone else from the industry who's a senior. We said hey, look, if we keep debating ourselves we will not come to a conclusion because, obviously, we're in two sides of the camp, but let’s get a third party and that help. So we got an understanding that in the marketing or mar-tech industry, what are the typical valuation models? We came a near reasonable assumption. Now the next problem was, OK, theoretically we agree the value is X. Now what about the payout? Again, we are a pure services business, month on month based on profits and that was, again, a hard challenge, but very thankful we finally came to an amicable agreement that will make it a 2 year payout on a monthly basis. We made it quite fair that if you miss payments, there will be an interest based on the market conditions so on so forth. I think, eventually, I would say the three month period was very hard, just like any separation because, to be honest, as you rightly said, you could plan for this, but when it hits you, it’s emotionally very hard because you know you built this together and suddenly one party wants to leave. But, yeah, we had no choice to kind of deal with this with it as adults and we put it into a contract, got it notarized. It was hard to actually pay out because that also meant it was detrimental to our growth or to our individual economics. But, as entrepreneurs, you have to suck it up and do it. If you’re playing the long term game in a services business, we had a 25-30 year horizon. We said you know what, in the long run maybe this 2 year will look like a blip and I’m glad we managed to kind of get through that. The insured the payment was taken care of within the 24 month period. I guess luck was also on our side because the business kept growing which meant we had a little bit more cash to further reinvest in terms of growth. I think timing was good. But, yeah, I think as they always say hope for the best but be prepared for the worst. It'll never pan out the way you want it to. As and when it happens, acknowledge first, take your time, but, I think, at the end of the day, I’m not too much of a conflict person. As I said earlier, I’ve not grown up in that environment, so be thorough and be respectful and being gentlemanly about the way you go about it. I think it’s important to have conflicts for sure, but I think in a healthy manner because again, life is long, you never know paths will cross. But I think the big thing I learned in my 10-12 year journey with Happy Marketer, Jeremy, is, I think, the value of external help, especially in areas that you don’t know much about. And even if you think you know about, it just brings a good objective perspective. And I think when it came to finance and legal, I don’t have a background in those subjects. Generally, it was very helpful to have friends from those industries come and advise us.
 

Jeremy Au: (19:54)
Wow. Thanks for sharing. I love this professional thinking about cofounder preparation and also breakups. Departures happen. If both of you are professional then it’s going to be a straightforward conversation even though it’s a hard conversation.
 

Prantik Mazumdar: (20:29)
And sometimes it’s, you know, deliberate. I recently came across someone who from property guru and I think their case study is quite well known. I mean it was amazing, they themselves realize that they need a professional CEO and eventually they got one and it was amazing. It’s never easy because I think they’ve documented as part of the NCR case study that it’s hard to let go but it’s amazing what they have done. So I think it’s also that sometimes a breakup can happen to you the way it happened to us, but sometimes you need to break up because maybe it’s not…the composition of the founding board is not the right one for future growth. So I think, yeah, and I’m glad today founders, hopefully the ones who are listening or people maybe already have an idea about this, that this is just part and parcel of growing a business. A change is inevitable. Your only choice you have is to embrace it.
 

Jeremy Au: (21:19)
Yeah, that’s 100% right and I agree with you. Great point. To move the story along, you’ve gone into angel investing, why?
 

Prantik Mazumdar: (21:58)
Yeah, it’s a good question. So I mean, first and foremost, I’m still part of the earnout. So there’s another good two, two and a half years ago. So that’s my core role to help happy marketer and the CXM group within Dentsu to grow. It’s a very interesting transformational time for Dentsu. But why Angel Investments, I think they’re honestly two reasons. The trigger point was sometime in, so our acquisition happened in 2019 and I did take a little bit of break. Glad I did before the pandemic and during those trips I started reflecting and I said OK, So what next? I mean, yes, I obviously there’s an earnout and I want to grow, but what are the other options out there? Because I’ve been kind of plugged into the Singapore startup ecosystem for now, 20 years in different formats. There were two real whys for me. One was in the pursuit of figuring out what next. I said I want to stay connected to the startup ecosystem. Obviously, I can’t start up right now. So the next two options that came my way were either to invest directly or through syndicates or through LP’s, or even to advice. So I think anything that gave me an opportunity to kind of stay plugged into the startup ecosystem, I suppose to vicariously live their life through the founders, I thought that was one. My core desire is to get a perspective of what’s happening in Southeast Asia. But I grew up in Indonesia, so Indonesia is close to heart. Obviously, it’s a hot market right now. Vietnam has been interesting and it’s just great to see how these economies are growing and how startups are playing a big role. So I think it gives me a good excuse on a weekly basis to connect with founders, investors, other ecosystem players just to understand their perspective. So that, hopefully, once my earnout is done, it paves a path or an option for me to figure out, hey, if I do want to get back to the startup ecosystem, do I go in as a founder, co-founder, accelerator or as an investor, and I must say I’m quite enjoying the Angel investor and advisory journey. That’s one of the whys and the other is, it may sound altruistic, but the real reason is also to kind of give back. I’ve been very, very fortunate to kind of enjoy the fruits of the Singapore startup ecosystem. The way it’s beautifully structured and it’s so easy to set up. For me, as an immigrant, I think it’s been extremely fair and meritocratic. To me, I think I was telling this to another friend the other day that it’s so much about equitable opportunity and I think in today’s world, I’m glad people are talking about sustainability, diversity, equity. And I think the biggest thing I’m very fortunate about is equitable opportunity all through my life. I grew up in India, Indonesia, had a good education, came to NUS that accepted me. I got a grant etc. And I think about the common thread there is - I just got an opportunity. So to me I tell myself because I know you’re a seasoned investor, you probably know this better. But as an Angel, obviously, everyone advised and said look, it’s a very risky business and chances are obviously it is. So I told myself, look, whatever little quantum that I’m willing to kind of invest or play with, yes, I have to be prepared that this may never come back. But there is maybe this is my way of kind of appeasing myself or my fear is, hey, if it gave an entrepreneur a chance or some confidence, if it created some jobs. I honestly think that would give me a lot of satisfaction because I’ve been the beneficiary for a long while. So in the pursuit of what next and in the spirit of hopefully supporting the ecosystem that I’ve benefited from, that’s the real reason and hopefully I mean, having said all of this, hopefully this does make me some money.
 

Jeremy Au: (25:17)
Totally agree with you. It’s very similar to my journey as well as an angel investor. That being said, what are you looking out for as an angel investor? I’d love to brainstorm with you and talk about that.
 

Prantik Mazumdar: (26:01)
Yeah. So you know, I’m quite new to the journey. It’s about two years and I come from an operating background. So I think to be honest, when I started, it wasn’t a very deliberate thought process. But now I think as with most things in life, when I reverse engineer, if I try and draw patterns, I think a few things have stood out. I think because I’ve run a B2B business, I think I bit more biased towards B2B startups. Just not that B2C doesn’t have potential, it’s just my comfort level. I think from a region focus, I guess self-selection bias, most of the deals have been Singapore, ASEAN, and to some extent, India, wherever my networks are. So those are two ways I look at industry. Again I have a bit of…I do look at the region and you know at a macro level which industries are being invested in or there is a lot of growth in. So I think the usual suspects of Fintech and Insurtech, you know, by the time I started there are some that fall in that bucket. There are also some that, I think, again, are close to heart. So I think education, again, in the theme of equitable opportunity, I think taking different forms, especially the B2B side has been of interest and my wife’s a doctor, so I think health or health tech, not the pharma side, but again diagnostics or remote health, I think that’s been an interesting area. So these are probably the common elements but, of course, over time, I did start getting a taste of, again, Singapore with this 2030 plan of sustainability. So I’ve looked at a few. That are in the alternate protein or sustainability space as well. I mean Poland is a good example of how they tried to reduce waste, I suppose through the liquidation process. So yeah, I think those are at a macro level. The next set of criteria that I kind of deliberate about is, there’s a lot of talk, rightfully, about product market fit, but I think slightly before that, I look at two other factors. One is just the market size or the size of the problem. Is it a large enough problem? Are we going to see or are we already seeing unicorns? Again, not for the sake of getting the tag of a Unicorn. But is it a large problem set? I think that's one. The other is founder problem fit. Someone could be…I could be a good founder, but am I good for this particular problem set and if it’s large enough, I think I find that very interesting. Again, it’s hard to predict, but over three or four meals or conversation, you kind of try and get how passionate and what’s the depth or academic knowledge a person may have about the category, not just about his or her startup idea. So that matters a lot to me because, again, by the time I come in, usually post revenue obviously not post profit, but if it’s post revenue, I would want to get a sense of not just the founder but the founding team, you know how well entrenched are they into that subject? The next few things I look at is, of course, since I do post revenue, it’s more than the revenue quantum, it’s the repeat business even if someone has two clients, having seen that as an operator, it’s a great satisfaction and tells a lot about the company and the product if a customer comes back again and again, so couple of insurtech companies, the two example one had ten client, but maybe only one of them came back. The other one had three clients, but all repeat business. So that gave me good confidence of the latter. So that was an interesting factor I look at. Also because I’ve come from a services people background. I like to look at the team and obviously founding team both in terms of chemistry and equity structure because like we spoke about, there have been cases, where one founder has 90% and that’s it, and whilst that’s fine if that’s the agreement, but to me I think there has to be some sort of de-risking for the other founders to have a bit more of an incentive. Also, of late, I’m seeing startups where it may be early, but at least they are deliberating that I must keep 10 to 15% for resource. So some of the thought process I think does guide my thinking process because it’s still very early in the game where I come in. So you never know how it’s going to happen in terms of product market fit and scaling up. But I think some of these criteria in terms of market size, geography, industry, team structure, founder problem fit, ease of structure, quality of revenue. I think these are some that I've kind of, of late, I do deliberate a lot about. Of course I would do some reference checks. Of course if it's a coinvesting opportunity with an investor like you, for example, that helps, that gives some sort of a comfort level as well. But yeah, those are some parameters. That I would try and make some judgment calls on.
 

Jeremy Au: (30:19)
What’s interesting is that you and I are both founders who are now on the angel investor side. You talk to founders and you see a bit of yourself in them as well. What advice would you give them?
 

Prantik Mazumdar: (30:44)
That’s an interesting one. So, as a founder first thing I tell myself is - look, now I’m on the other side, so I can’t behave like a founder. Yes, I could share my perspective, but I’m not driving the show. I got to be very respectful of that. I gotta be comfortable in that skin. The next is I think, I mean, the two or three things that I do tell the portfolio companies when I catch up with them is, I think, one, is especially the product business. I think it’s important to love the problem and the solution that you’re building. But I think there needs to be some element of being nimble and flexibility to pivot and, again, not pivot because it’s a cool term, but it’s about to get to that product market fit. You may have started off with IDEA A. But maybe idea A is not the best way to get to that commercial viability, so that flexibility on being coachable or just being open to ideas, to explore models. I think, to me, that’s important. Second thing is competition. It’s one of those when you say who’s competition? Many of them would say, hey, by the way, you know, we have no competition and that’s a red flag for me because it may be true that there is no direct competition, but I think there could be in most cases there is indirect competition. Maybe the customers are solving the problem in a completely different way. So I think very, very important to kind of be near paranoid, if not paranoid. Just be curious about who else could attack me if there isn’t an existing competition already. The third is, I think, especially if it’s in a scaling up stage. I think what I kind of tell them is the importance of creating processes and systems ‘cause we learned this the hard way, even in a service business, is if it’s dependent on a founder, an individual, that’s a lot of risk. There’s a key man, risk, etc. But as a business, if you have to scale, I think you’ve got to figure out systems, processes and teams that can help you generate predictable, scalable, repeatable revenue without the hero. Whoever the founder is, and that’s important. So you know, I’m a big fan of Verne Harnish’s book Scale Up and I learned a lot about how do you kind of build those tools and processes and teams to do that. And the same goes on the delivery side. I think in the region, I think especially product startups, I’ve been telling them that, hey, look, you also got to be vigilant and focused about variables in your control. You can’t control all variables. But if you’re building a product A, are you optimizing for UI UX or what about the core product? Are you hiring, recruiting, good quality data science and engineers I find this even in many of my portfolio companies, that many of them are probably not…they could do much better to invest in the product team’s engineers up front or whenever they have access to funding. So I think that’s something I would love to see more of because, again, a few of my friends were happy to be let’s say, whether in China, India or the Valley where things have scaled up so much, I think the focus on good engineering is massive. So I think that’s another. The last iss really about if you are and again and I gotta be careful there because I’ve never run a VC investable business. But from an objective lens, I think, if you’re playing that VC game, someone also has to be driving the whole raising process and we are obviously…you obviously know this much better than me. We are in a market where there’s a lot of cash, money is chasing, the tigers of the world have changed the model, going in early. So who’s going to drive that process? Who do you pick up money from? Because, again, I was telling you when I was having a conversation with the other VC’s. The signal is that the founders have a lot of choice. So if that’s indeed the case, I think it’s very important for founders to kind of be strong from a perspective of just being rational about who do you want to raise from and why. Who are the other people you’re talking about? So someone has to be deliberate about that process and be very, very good at negotiating those terms, something that’s fair, yet helps the business. So, yeah, as a founder, I think some of my conversations with the other founders are, yes, initially you’re the only one or maybe one of the four important people, but you’ve got to plug yourself outside of the business or on the business. You can after a while, you need to get to a stage where you’re on the business and not in the business so that you can look at these different jigsaw puzzles together, that’s the fun. That’s the challenge. You’ve got to be raising. You got to be racing for growth. You also may need to be able to remove competition. My conversations are usually around these when I have time to chat with these founders.
 

Jeremy Au: (35:04)
You’ve also done mezzanine investing across US, Europe, you’ve also become an LP in VC funds. Talk us through what it’s like to be an LP in a VC fund.
 

Prantik Mazumdar: (35:23)
It is a privilege. I’ll tell you my rationale for doing that. I suppose it’s a bit of hedging because the early stage, the objective I told you are those two factors of staying rooted to the ecosystem and giving back. But of course, you know, as I’ve learned, you’ve got to play the game a bit of longer time. Exits may come, if at all they come, four, five years, seven years, ten years. On the other side of the spectrum was when I came across some of these late stage mezzanine deals with Palantir UI parts tried, I realize these are relatively like Palantir kind of got it maybe six months or eight months before the IPO. So I think it did two things to be honest. One is it provided relatively safer near term liquidity if it did well. So Palantir was a good one for me. So that definitely helped. To be very honest, there’s also a bit of conversation factor because it kind of opened doors when I did that and people heard that or read that I started…it kind of became a, I suppose a door or conversation starter, which definitely helps. So I think the mezzanine pre IPO did that. It also allowed me to kind of network with a different set of folks, the folks from the I-banking world, which, to be honest, during my Happy Marketer days, I really wasn’t interacting with too many. So I started getting used to their terms, their buzzwords, you know, in my industry and used to CPC/CTR. But it was good to kind of hear their set of terms, their perspectives on the world. The VCs were, I suppose, somewhere in the middle ground as an LP. It was very interesting. I think it did two things. I think it allowed me A, a chance to network with the other LP’s. Definitely helps the network which was very interesting. It has shaped my angel investment process as well because what I had not understood or done well in the angel investing process is the commercial and contract negotiation and I’ve learned when I see how the VC’s do it, how you guys do it, it’s there’s a nice filtering process. You guys probably look at 1000 deals and pick 20 or 50. So, A, already the deals you are attracting because who you are is already high quality. B, there’s a nice diligence filtration process which is needed and just good. But I think what opened my eyes was the contractual commercial negotiation process like till I did some Co investments, until I saw the VC terms, I didn’t ever think about liquidation preference for example. I would only think of the entry, not the exit process. That was an eye opener. Also the planning that when you’re investing in company A, broadly, most VC’s typically have an idea that, hey, if it grows this way, here’s a potential exit. Maybe I’ll talk to a bigger VC or here’s a strategic that I can look at. So I think it’s that it’s the post entry, post investment journey. The thought process I think it was a big, big learning lesson for me, but wouldn’t have happened otherwise. So quite privileged. So I think each of these three buckets bring different networks, different language and different processes, which as a pure founder, I would have never have the opportunity to kind of learn from.
 

Jeremy Au: (38:21)
Amazing. Wrapping things up here, could you share with us a time where you were BRAVE?
 

Prantik Mazumdar: (38:27)
Well, two things come to mind, Jeremy. One is you’ve taken me back to NUS days. So as I was saying, I was quite a privileged person when it came to education, opportunities etc. And I’ve done well in my academic life all till the point I came to NUS and it was in my year three that I failed for the first time in a module, let alone not doing well. I failed in an electronics module. It was embarrassing and I think the brave part of it in hindsight was owning up and accepting that failure. Honestly took me a lot to accept that. I’ve always, in Jakarta, I stood first in A-levels in the whole city. Suddenly, I’m here in a good university and, suddenly, I’ve flunked a module. To open up to my friends, to my parents. It may not sound much, but at that point in time, I think it was massive and to be honest, in our Asian or Singapore education system, I think what it did to me is it kind of told me that acknowledging and being open to failure and figuring out a way to come out. It takes a lot, it makes you humble. It tells you that you’re not as good as you think you are, and it helps you find a process, just the way Bill Gates says. You learn so much more from failure. That bravery to face up to society, especially in Asian contexts, that’s something that comes to mind. From a work context, is letting go of a client. Being a salesman, 99% of my time is to acquire clients, but, I think there were two occasions where for two different reasons I had to let go of a client and communicate that to a client. Again, in a Singapore Asian context that hey, we don’t want to work with you. One was because of lack of payments and the other one was because of the client was not treating our team very well and I realized the importance of that. Again, it was a very hard decision. Because you know, as a sales person just not used to it. I’m used to saying I’m here begging for your business. I’m here to win your business, but to kind of again goes back to separation and the divorcing process. It took a lot of humility, took a lot of practice to kind of shape the narrative because, of course, you want to bow out, but you want to bow out respectfully, don’t wanna burn bridges. But I think when it came to the cash, I could still understand. Fine, I can find a way. But I think it took a huge toll on me, Rachit, and our teams were not being respected. And I think when you’re running a services business, all you have is people, good people. And if it impacts your culture, we learned it the hard way, read in a book that you've got to be employee first. But when I had to do that. At that that very morning after my Starbucks coffee, when I had to enter that office and still remember to kind of break the news, the client obviously was not expecting that. I haven’t saved a life like my wife does in a daily basis. I haven’t climbed the Himalayas, but, to me, breaking up with a client which paid very well, I thought, took a decent amount of bravery.
 

Jeremy Au: (41:09)
Wow. Thank you so much for sharing that. Breaking up with a client is very tough because you spend so much time managing this person and to call it quits. I totally get it.
I’ll love to wrap things up here to share the three big things that I learnt from you during this conversation. The first is thank you so much for sharing what your founder path was and shared a lot of knowledge of the professional cofounder relationship, the preparation, the picking the discussions, the negotiations, the relationships, and even the breakup, and I love that long term view looking back at the end of the day, it’s business in the sense that it’s expected that people move on from any company and it could be a cofounder moving on, it could be yourself moving on, it’s really about how the conversation is handled and that’s such great advice because it helps people who are thinking about breaking up and cofounders who are having tough times, and even founders who are worried about having a cofounder because they’re scared about having an eventual breakup. Really strong advice.
The second is thank you so much about the angel and founder POV. Sharing what you think about why you angel invest personally and why that’s relevant about other folks, but also the advice that you would give other founders now that they’re pitching to you about how to be thoughtful about their approach, their team and how they present…I think the keyword here is coachable.
The last thing that I love to share is that you really have a strong point of view on what I call the moment of bravery – these are the tough moments that you faced, breaking up with clients, negotiating cofounders and I just love that humility and frankness about how to get help and be brave. Thank you so much, Prantik, for coming on the show.
 

Prantik Mazumdar: (43:36)
Thank you, Jeremy, I think these conversations help one reflect and I’ve learnt so much and I’m a big fan of your podcast and the stuff that you guys write on your blog. I think what you’re doing is great to allow people a platform to share their story, their bravery, their failures, but I think hopefully people who are listening, if it sparks an idea, that’s the beauty of these platforms and thank you for doing this for the Brave podcast.
 

Jeremy Au: (44:05)
Thank you so much, Prantik.
 

Prantik Mazumdar: (44:06)
Thank you. Pleasure being here.