‘Most of our startups achieved their goals despite downturn’

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In an interview, Swamy said that most of their portfolio companies achieved their goals this year. “In that sense, it has been a good year. In terms of raising a growth round, that has not happened, but that is across the ecosystem,” Swamy said.

Swamy says the year was good for companies that were efficient in marketing, getting the best RoI. “This is an opportunity for companies to take a breather; during growth, there will always be some bad habits, but there are times when you need to go back and revisit some of these habits. Many of our startups have taken a step back and used this opportunity to either sharpen their operation, focus more on receiving a higher RoI from marketing efforts, basically turning more efficient.”

Using the driving analogy, Swamy says that when you face a pothole, you sometimes must come to a complete standstill and get out.

Prime Venture Partners is currently investing out of its fourth fund, which has a corpus of $120 million.

Swamy is confident that strong companies will succeed in this environment and believes the downturn will encourage founders to focus on long-term strategy rather than seeking large growth funding as they did last year.

“Last year, we saw how capital was used as a weapon while it is not a weapon but a tool, and the companies that have done that will struggle. Whoever can’t control the burn will disappear,” said Swamy.

One of Prime’s portfolio startups, MFine, a mobile healthcare platform, went through mass layoffs last year. Swamy said, “It was unfortunate what happened with MFine as they were at a high burn stage where they needed to keep spending in terms of marketing efforts. Other than MFine, most of our companies have adaptable burn rates, which means companies don’t just go out of business to start; they can work with the money they have and survive the downturn.

Mfine merged with the diagnostics business of LifeCell International Pvt. Ltd. The merged entity, LifeWell, secured $80 million from healthcare-focused global investment firm OrbiMed.

Prime Venture Partners’ first fund portfolio consists of seven firms, including interactive learning startup Quizziz, which raised a Series B funding round led by Tiger Global last year, and Happay, which was acquired by Kunal Shah led Cred late last year.

In the past decade, Prime has been the first institutional investor and built up one of the largest portfolios of fintech startups, including Niyo, Ezetap, Freo, KredX and others.

Additionally, during the past 12 months, three of Prime’s early fintech investments were acquired by marquee brands. These include the acquisition of business expense, payments and travel management platform Happay by Cred for $180 million, financial operations startup Recko by Stripe, and retail-technology startup Perpule by Amazon.

Founded in 2011 by Amit Somani, Bala Parthasarathy, Shripati Acharya and Swamy, It invests in disruptive technology startups across the fintech, edtech, healthtech, consumer internet and global SaaS segments. In terms of new areas, Prime would likely explore investing in startups across startups using AI/ML for business transformation, global SaaS models, Blockchain, EVs and Infrastructure plays around Web 3.0 gaming.

Swamy is known for his founding role at ZipDial (now acquired by Twitter) and his role at mChek, a startup in secure payments. After completing his bachelor’s degree in engineering, Swamy headed to Paris where he received his Master’s degree. After a stint at Xerox PARC in Palo Alto, he worked in startups like Ketera and Portal Software, mChek, Zipdial and Ezetap, which he cofounded in 2010.

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