Sateesh Andra and Ramesh Byrapaneni: Nurturing Impactful Start-ups with Precision

Imagine entrepreneurs as either alternating current (AC) or direct current (DC), where AC represents those who chase high valuations, and DC symbolizes those who value their ventures as a cherished possession. Sateesh Andra, Managing Director of Endiya, a prominent early-stage venture capital firm, makes it clear which trait he believes is more detrimental for a founder. In his view, the latter, who is overly possessive, poses a more significant risk to a start-up’s success.

When asked if hyper-valuation is more dangerous, Sateesh Andra provides a nuanced perspective. He sees frothy valuations as an opportunity that savvy entrepreneurs should seize. In a globally connected world, a smart founder will locate talent wherever it exists, raise capital from the most promising sources, maximize profit margins, and take the start up public or exit when offered attractive multiples. However, Andra acknowledges that an astute founder should recognize that skyrocketing valuations might be a short-lived phenomenon. It’s crucial to utilize capital effectively to protect the company’s interests in the long run.

The real challenge, in Andra’s opinion, lies with founders who cannot transition from building a product to building an enduring company. Such founders become overly attached to their roles as CEOs, failing to exit when necessary. He highlights the critical need for founders to eventually switch from being the actor to the director of their start-up. A successful company requires more than just the product; it needs a brand, financial management, distribution channels, and customer support.

In this journey, Sateesh Andra’s business partner, Ramesh Byrapaneni, complements his role. Byrapaneni, the co-founder and Managing Director at Endiya, describes their collaboration as a fusion of heart and brain. While Andra brings the engineering and investment expertise, Byrapaneni, a cardiologist-turned-entrepreneur-turned-investor, injects the heart and clinical experience into their dynamic partnership. Their collaboration embodies a perfect blend of skills and intuition, akin to a winning doubles tennis team with complementary abilities.

Endiya’s core focus, according to Andra, is on creating lasting impact. The fund prides itself on its rigorous selection process for investors, entrepreneurs, and the amount of capital deployed. As an early-stage venture capital firm with $100 million in assets under management (AUM), Endiya typically initiates investments in the range of $1 million to $2 million for seed or pre-Series A rounds. Moreover, 95 percent of Endiya’s investments serve as the first institutional cheques for start-ups, and follow-on rounds can see investments of up to $5 million per start-up.

Endiya’s disciplined approach has yielded impressive results. Over 75 percent of its portfolio companies have successfully raised subsequent funding rounds, in contrast to the industry average of 30 percent. Notable among its success stories is Darwinbox, a SaaS platform for workforce, talent, and HR services. When Endiya made a seed investment in 2016, the company had 20 clients and a valuation of around $5 million. Fast forward to 2022, Darwinbox has become a unicorn, raising over $111 million, with a valuation that has grown over 200 times, and a client base that expanded more than 30 times. What sets Endiya apart is its sector-specific approach. The fund has invested in several healthcare start-ups such as Cure.fit, SigTuple, Synapsica, eKincare, and Sugar.fit, illustrating its specialization in select sectors. This strategy focuses on providing solutions to entrepreneurs rather than simply asking intelligent questions. Endiya’s dedication to solving problems alongside its portfolio companies and its selectiveness in investments have solidified its place in the industry.

Despite the high risks associated with early-stage investments, including product, team, and market risks, Endiya stands out as a beacon of success. The co-founders attribute their achievements to their unwavering commitment to their investment mission. They also acknowledge the challenges posed by an overflow of capital, which led to a flurry of investments and soaring valuations in the Indian start-up ecosystem. To remain true to their purpose, Sateesh Andra and Ramesh Byrapaneni have gone back to their roots, refocusing on the core philosophy of their investments. For Endiya, the goal is to back start-ups capable of creating a lasting impact. Their patience, expertise, and commitment have allowed them to weather the tumultuous phases of the early-stage investment landscape. While the journey is not without challenges, their distinct chemistry and shared vision are driving Endiya’s success as they rewrite the investment thesis with precision and purpose.

In a world where start-ups chase valuations, Endiya focuses on creating impact and nurturing businesses that stand the test of time.