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Fund In Focus: Platform-First Investing: Gemba Capital's Formula for Sustainable Growth

Adith Podhar, Founding Partner, Gemba Capital

Welcome to our ‘Fund in Focus’ series where we profile our member VC funds, underscore their investment philosophy, and highlight some of their interesting work. In this exclusive chat with Adith Podhar, Founding Partner, Gemba Capital where he shares how the firm has emerged as a leading micro-VC firm in India, investing in 50+ startups with a focus on pre-seed and seed stages. He also threw light on on their "platform-first" philosophy, emphasis on founder-market fit, and plans for their ₹250 Cr Fund II. By nurturing strong relationships and addressing early-stage funding gaps, Gemba is redefining venture capital for Indian startups.

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Spokesperson: Adith Podhar, Founding Partner, Gemba Capital

1. Could you walk us through the journey of Gemba Capital since its inception in 2018? What were the key milestones that shaped its growth into one of India's leading micro-VC firms?

Gemba Capital was started by Adith Podhar in 2018 to invest in early-stage tech startups led by founders who have an unwavering ambition to build world-class businesses. Till date, the firm has backed 120+ founders across 50+ startups. Some of the notable portfolio companies are Plum (Insurtech), Grip Invest, Wint Wealth, UnnatiAgri, Navadhan Capital, Zuper, Showroom, Voltmoney, Smartstaff and LightFury games.
From 2018 to 2021, Gemba Capital was investing proprietary capital and running our Syndicate, which we collectively refer to as ‘Fund 0’. During this period, we invested in 33 companies in pre-seed and seed rounds. First two years, we call it building foundational blocks wherein time was invested in understanding the nuances of seed and pre-seed investing, building our investment thesis, evaluation framework and mental models. We also moved our office from Mumbai to Bangalore, which is one of the key milestones for us.
As Covid pandemic struck, 2020 was quite challenging. However, every crisis has a silver lining. We started Gemba Capital Syndicate on AngelList attracting 500+ members, with some even becoming Limited Partners (LPs) in our debut fund - Fund I. Vipul Rawal also joined us as a Fintech Venture Partner during this period. From 2021 onwards, we refined our investment thesis and focused more on technology enabled startups across 5-6 sectors.
The success of ‘Fund 0’ laid the foundation for raising our first institutional fund, ‘Fund-I’, of ~Rs. 70 Cr in 2022 through which have invested in 20 companies till date.
In 2023, Govind Lohia joined the team as a Principal and in 2024, we received SEBI license for our second fund of ~Rs. 250 Cr focused on investing in Fintech, Consumer tech and B2B Platforms. Ranjeet Singh, cofounder at Pratilipi joined as Consumer tech Venture Partner and Somak Ghosh, founder at Contrarian Capital and banking veteran joined as a Board Advisor in 2024.
Venture Capital is high risk high return asset class and the investment manager has to make capital allocation decision in a highly uncertain environment, that’s where the GP’s background in Private Equity investing, infused a sense of rigor, discipline, and framework at Gemba Capital. We operated as institutional VC from day zero, a distinctive feature often lacking in the pre-seed/seed stage investing landscape in India. We are one of the few micro-VCs who are not using the indexing strategy and building a rather concentrated portfolio across our focus sectors.
We have been consistent with our broad investment strategy of investing only in pre-seed/seed rounds across our focus sectors, investing in <10 deals a year and focusing on value addition in the portfolio companies.

2. The name ‘Gemba’ reflects the concept of "the real workplace" in Japanese. How does this philosophy resonate with your work in venture capital and your engagement with founders?

Simply put Gemba philosophy means, rolling up your sleeves and being on-ground. It’s the shopfloor, the warehouse, the retail store where value is created and not the corporate meeting room. We believe all answers/solutions to your problems and real truth can be found at ‘Gemba’. The term is often used in Lean Management to emphasize that real improvement requires a shop-floor focus based on direct observation of current conditions.

This is the philosophy we try to imbibe when we are evaluating deals to make investing decisions and when we engage with our portfolio companies.

3. With the target corpus of INR 250 Cr for Fund II, what is the vision you aim to achieve with this fund, and how does it differ from Fund I?

  • Stage mix -The investment approach for both the funds is consistent and we will continue investing in pre-seed and seed rounds with ~30% reserve allocation for follow-on investments.

  • Portfolio Size -Fund II Portfolio size ~30 companies with not more than 10 deals per year. The number is slightly higher than Fund-I portfolio of ~24 companies, since our allocation to Consumer tech in Fund-II has increased as compared to Fund-I.

  • Focus Sectors -In Fund I, we focused on 4 sectors – Fintech, Consumer tech, Enterprise Software and B2B Platforms. Fintech was key sector in Fund I with over 40% allocation. For Fund II, we intend to raise our Fintech allocation to 50%. Remaining 50% will be split across Consumer tech and B2B Platforms.

  • Average Ownership -In Fund II, we will increase our ownership in companies to ~7-9% from the current ~2-5% at Fund-I.

  • Average cheque size -Average first cheque size will increase to ~Rs. 5 Cr in Fund-II from the current average of ~Rs. 2 Cr in Fund-I.

  • Co-lead/Lead transactionse -In Fund II, we will co-lead or lead transactions.

4. Could you elaborate on your emphasis on "platform-first" businesses? Why do you believe these businesses create sustainable competitive advantages?

  • We refer to the platform as a business model. The core value proposition of a platform is to facilitate the exchange of value among network participants by solving for lack of trust, information asymmetry, and operational inefficiencies. This exchange of value can be in the form of products, services, or data. In Fund-II, our thesis is to invest in ‘Platform-first’ businesses which can build compounding moats through ecosystem creation, network effects, proprietary information or ability to stack value-add layers.

  • Over 70% of unicorns in India by this definition are platform businesses.We foresee the forthcoming decade as the era of "Platform businesses as India's digital economy is expected to surpass $1 Trillion by next decade and large scale platform first businesses will emerge in our focus sectors. Some examples of Platform businesses are: Flipkart, Amazon, Zepto, Udaan, Moglix, Progcap, Yubi, Zomato, Nyka, Ola, Sharechat, Pratilipi, Pharmeasy, Urban Company, Livspace, and Myntra.

  • Platform businesses can create sustainable competitive advantages as they’re able to operate at an intersection of supply side economies of scale (scale benefits), demand side economies of scale (network effects) and data/proprietary intelligence.


Our standout performers/emerging winners within our portfolio have consistently been platform-based companies. These businesses have shown significant potential for growth and value creation. Ex- GripInvest, Wintwealth, Showroom, UnnatiAgri. Platform companies have demonstrated resilience, particularly during the challenging times brought about by the COVID-19 pandemic and the market downturn in 2022.

5. Fund II plans to engage with institutional LPs. How do you see these partnerships shaping Gemba’s investment strategy and impact on the startup ecosystem?

Our investment strategy will not undergo any change since we already operate as an institutional VC Fund. Being a first-time fund manager, our Fund-I was small, and hence we never approached any institutional LPs.

Gemba Capital operates with a highly engaged model, fostering strong relationships and maintaining open and timely communication with our limited partners (LPs). As an institutional fund from the outset, we have established robust processes and an LP webportal for records and regularly sharing bi-annual reports that align with global reporting standards.

With Fund-II, we have a portfolio to showcase and with a target of $30Mn, we should be able to attract capital from institutional LPs. It will be a very good sign for the founders and the startup ecosystem if more domestic and international institutional LPs start investing micro-VC fund like ours. Indian seed/ pre-seed stage startup ecosystem requires more institutional capital to be deployed through single-stage VC funds like Gemba Capital.

Institutional LPs who operate businesses in our focus sectors have additional synergies of working along with us to identify early winners and innovative startups for strategic opportunities as well. Such institutional LPs will also provide invaluable guidance to our portfolio companies.

6. What are the key attributes you look for in founders during the pre-seed and seed stages? How do you evaluate their ability to build world-class companies?

Founder market fit: We focus extensively on the founder's work and personal background to assess founder market fit, viewing it as an important parameter to take the evaluation to the next steps. We also have an in-house Founder Market Fit framework that allows us to assess the founders we are investing in effectively.

Founders Attribute Framework

7. Gemba Capital emphasizes building lasting relationships. How do you nurture these relationships with your portfolio companies and founders?

VC is a peoples’ business. We are in the services business where our network is our net worth. People and deep relationships keep this business away from becoming a mere financial and transactional in nature. Network effects also show prominently in this industry. We nurture our relationships by listening and being genuinely interested in solving the problems of the founders and adding value. By being a friend to them who also criticizes and shows the right way/path. We insist on getting MIS and provide feedback, whenever necessary.

We strive to provide value beyond just capital, actively supporting portfolio companies in multiple areas such as customer introductions, fundraising and strategic planning. Founders recognise the immense value we bring to the cap table, which sets us apart. We act as trusted sounding boarding for founders and actively encourage open and transparent dialogue with the founders wherein, they can freely discuss business challenges, seek advice, and share any concerns with us.

Our Venture Partners (VP) also play a critical role in their domain and are like extended investment team members for us and our portfolio founders. There have been many instances, where we despite not being the largest investor on the cap table have added 10x more value to the founder than the lead investor. Some of our founders have become LPs or helped us in getting LPs, are our cheerleaders, sent us deals and so on.

8. How do you perceive the evolution of the Indian startup ecosystem, especially in early-stage funding? What role does a micro-VC play in this growth story?

Micro-VCs address a big gap in funding. Angel cheques are Rs. 10 lakhs to 1 Cr normally. VCs >$75Mn, want to write a Rs. 8 Cr+ cheque to meet their ownership targets and deploy the fund in time. Micro-VCs address this gap in funding between Rs. 1 Cr to Rs. 8 Cr.

Micro-VCs are the institutional investor for the founder, who adds substantial value and makes the Company/founders ready for the next round of funding. This is not an Optionality cheque for the micro-VC unlike receiving $1M from a $500M Fund. This is no foot-in-the door strategy and hence Partner level engagement is possible for the founders who take money from micro-VCs, which otherwise is not possible in the case of large VCs.

There is no signaling bias – if a micro-VC doesn’t participate in the next round of funding, which becomes a major issue if you have a large fund in the seed round not participating or leading the next round. Seed stage founders’ now prefer working with micro-VCs over larger funds due to their agility in decision-making, offering low-friction cheques and willingness to collaborate with other micro-VCs.

Founders’ have also realised that barring a few business models, you do not need a lot of cash when you don’t have PMF. Too much capital, sets off a string of wrong foundational decisions in company building and impairs your ability to raise the next round as well.

Multi-stage strategies have not worked in India, unlike the US and some of the ‘imported’ concepts like Power Law are US market-based concepts – which might not work in India, given the Indian market is very different from the US. You will see stage specific and sector specific expert micro-VC Funds thriving as the Indian startup ecosystem matures and finds more depth.

Currently, the Indian startup ecosystem is 3rd largest in the world. India's economy is projected to grow from USD 3.75 Tn to USD 6 Tn by 2030 and overall digital economy is projected to grow from $100Bn in 2021 to $1Trillion by 2030, driven by factors like growing online domestic consumption, positive economic outlook, government stability and initiatives, and advanced digital public infrastructure.

9. As an investor, what are the top lessons you’ve learned from the successes and challenges faced by your portfolio companies?

    Lessons learned from portfolio companies’ success

  • Companies that prioritize capital efficiency and maintain a low burn rate can effectively navigate fundraising challenges during downturns. Such companies do not spend and raise a lot of capital till they see signs of PMF.
  • Building a product from first principles based on constant customer feedback always wins.
  • Pivoting fast and more importantly knowing when to pivot. Such companies do not fall for false positives.
  • Culture within the company to focus on raw numbers and data to take decisions.
  • Ability to hire and retain great talent in the team.


    Lessons learned from portfolio companies’ challenges

  • Struggling to identify effective monetization strategies early on is a signal that PMF is not happening.
  • Business models that heavily rely on high cash burn, where capital is a moat are not the right models for micro-VCs like us to invest in.
  • Founder’s inability to crack GTM is often the reason why companies die.
  • Operating in a crowded market, with low defensibility product - such companies find it tough to raise further capital
  • Throwing people at a problem instead of solving it through tech/processes never works.
  • No tech cofounder and solo founder – such companies also find it tough to scale fast.

10. What is your long-term vision for Gemba Capital? How do you envision its role in shaping India’s entrepreneurial landscape?

  • We aspire to become India’s leading seed-focused institutional fund, supporting ambitious entrepreneurs targeting large, high-growth markets. Over the next decade, we aim to invest in areas where founders can create impactful startups by addressing underserved domestic markets.

  • We will focus on nurturing our portfolio while making capital allocation decisions aimed at maximizing returns for our limited partners.

  • In the next ten years, we plan to launch another 3 flagship seed funds, taking our total to 5 funds by 2034, besides doing Continuity Funds as well. In total managing ~Rs. 4,000 Cr AUM by 2034. We aspire to be the investor of first choice for founders for early-stage deals in India's startup ecosystem.

The content in this section is curated by Team IVCA. For any feedback, connect with paromita.sinha@ivca.in

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