I remember the first time Sandeep Aggarwal called me to tell me about his new idea, Droom (‘To dream’ in Dutch). I knew then that if Sandeep was starting something new, we had to be involved. We’ve known Sandeep from the time he started Shopclues. There was no Lightbox then. But as a group of individuals, the now Lightbox partners made an angel investment in his vision, his passion and his determination to succeed. And through that investment, we built a relationship, a friendship, based on trust and mutual respect.
So, when Sandeep called, you can imagine I was all ears. Partly because it had to do with cars, but mostly because it was Sandeep. In fact, it was Sandeep 2.0 - along with the passion, the vision and the determination, now came a battle tested entrepreneur with a tremendous amount of exposure and experience in the Indian market and in scaling businesses.
Outside of Sandeep though, I understood very little about opportunity and he was looking at a large round with a sizable investment from us. Now that we’ve done the deal, I can tell you it was a major decision for us. Droom is the largest series A bet we’ve ever made. And since it was such a big deal for us, I thought this was an ideal opportunity to walk you through how we decide to make investments in general.
When we dive into prospective investments, we normally ask the same 3 core ques-tions. First, Does the space excite us? Second, how differentiated in the model? Finally, is the founder someone we want to work with - this last one is so critical for us. As a fund, we maintain a very small number of investments, mainly so we can work closely with our entrepreneurs. If we can’t see ourselves being able to create a long term partnership with the founder, its very difficult to make the investment - irrespective of how promising the deal looks.
Quickly, let me tell you what Droom does - It’s an online marketplace to buy, sell and service used automobiles.
Okay, let’s talk about how we dissected Droom!