Anand Chandrasekaran, partner at General Catalyst, is one of the top global product leaders. Previously, he was the CPO at Facebook, now Meta; Five9; Snapdeal; and Bharati Airtel.
Over the years, Anand has built five global products that have grown to reach over 10 million users each. He also co-founded Aeroprise Inc and was the EVP of products at Five9, which added $10 billion in value since 2019.
Anand has also been an investor in over 80 startups, including Aisle, DealShare, Fynd, Netmeds, Creo, and Innov8, in India and the US.
An MS in electrical engineering from Stanford University, Anand has been named as a Young Global Leader by the World Economic Forum.
In a conversation with YourStory, Anand talks about his journey from being a product manager to an investor, the importance of having a product-centric approach, and his views on startups.
Edited excerpts from the interview:
YourStory (YS): You have always been building products. From then to now, how is the shift like on the VC side?
Anand Chandrasekaran (AC): I normally have a very product centric approach to thinking and looking at businesses. When I moved to India in 2014, I was often asked what does a CPO do? And genuinely, there wasn’t much awareness and understanding of the function. I was building products and it was important to have a narrative to understand why better products can lead to better businesses.
We worked on Airtel Money and Wynk Music, and that is when people started seeing first hand how better products can actually create a business impact. Startups too were facing the same problem, where while they knew that product was important, there wasn’t a larger narrative around it.
That is how the founders brought in value on the cap table. These people had other expertise, and they felt that it would be great to raise money from someone who builds products. This helped with feedback and hiring people in product engineering. They would increasingly start solving business problems with product, for example, they would say - the costs in my supply chain are high and how do I solve it as a product problem.
Thus, we were able to solve some major business problems by converting them into engineering problems. This was an insight for me.
I was an early investor in Rupeek, NoBroker, DealShare, MoEngage, and others, and soon the narrative started to take root that you need to genuinely have a product-centric approach.
This was the insight that got me into investing.
Anand Chandrasekaran
YS: What is it like being an investor today? Why did you choose General Catalyst?
AC: For me, the shift was actually quite natural and organic. There are a few things that resonated with me.
One is that General Catalyst (GC) has been around for over a decade, and they approach investing with a makers’ mentality. And this was exactly how I approached angel investing. It is about thinking like a builder.
One of the things we do is build companies within GC and we incubate companies inside GC. One of the parts of the fund is a creation fund that is dedicated to new companies that are hatched within GC.
The other part that compelled me was radical collaboration. We believe in partnering with the founders, and within the firm we try to create and build the company. We do this in a cross functional way.
We have done close to seven deals in India in the past four months, and more than just understanding the founder and the business, it is about everything the firm does.
The last part is responsible innovation. There is a belief that societal good and profits have to be mutually exclusive and both can’t be done together.
Increasingly, it is being seen that most businesses become successful because the founders align with a larger focus on responsible innovation and are focussed on both profit and societal good. They compound over a long time because they are good for the society as well. We believe this has to be part of the company building process.
Thus, when we talk to a company, we look at different aspects of the organisation that can have unintended consequences of societal growth, and how the founder views the business in terms of societal good.
YS: How do you view your investments different from other investors?
AC: There are two things here -- you need to have a significantly deep partnership with the founder. This was happening in the valley from 2010, where everything had become founder centric. And we saw that more in India. Founders had started looking closely at the kind of investors they wanted to partner with as they were building along a 10 year cycle.
It was about the partnerships. It is important that both parties be in the partnership for a long term. Another important fact was that early startups that broke out in India were addressing a different market, but today it is changing. More people are online and have access to information. This is opening opportunities across commerce, edtech, B2B marketplaces, and everything that is meaningful for the next 500 million.
Today, I believe there are a bunch of companies that are going to be built for the next 500 million.
YS: How has the investment landscape changed?
AC: Today, there is significantly more capital available in India, which means that founders have a choice of partners. This in turn changes the dynamics, which is a good development for the ecosystem.
Back in 2014, being a founder wasn’t a cool thing, and there wasn’t much social acceptance. But today there is not just social acceptance, but also a pressure to start up. This in turn is making a lot of young people to view starting up as a way to making India better.
As wealth gets created for companies, investors, and employees, it gets back into the ecosystem in the form of angel investments.
Today, we see a vibrant ecosystem, which I am lucky to be a part of, and this is phenomenal for founders as they get help from the right people. Also, remote working has democratised access in ways like never before for talent acquisition and even starting up.
YS: How has the role of a CPO changed and how has product thinking changed?
AC: It has changed significantly. People have realised that at the end of the day, they have to solve for business problems and consumer problems. Product and engineering is a strong lever, and while it may not solve every problem, it is a great tool. People are looking at how they can address a problem using an engineering solution or product experience.
In the B2B space, Indian founders are building some of the best product experience. Today, Indian SaaS companies are becoming the gold standard in terms of experiences. These are strong developments, and has further pushed people to think product wise.
YS: How have products evolved over time?
AC: Globally, there is a shift towards responsible innovation. Founders are now looking to bring in stronger mindset into systems and algorithms are built from day one, because as the business grows, the way these systems work also grows.
Ethical consumption is a big shift. Founders are looking at businesses more from a long term perspective, and are very particular about how they build the product.
YS: What advice do you give founders today?
AC: As an angel investor, it was believed that I was providing a lot of knowledge, but the reverse is true, the knowledge and insights you get from the founders is great.
What investors can do is be trusted partners with the founders as they mostly have the answers. They may just need people to help them look at alternatives. The partnerships are becoming longer and longer so it is important that trust is built between the founders and the investors from day one.
Edited by Megha Reddy