Mohit Sadaani, co-founder of The Moms Co, remains committed to investing in businesses with solid fundamentals and a strong demand from customers. He acknowledges the emergence of numerous exceptional businesses aligned with this ethos and has seized investment opportunities in a select few over the past years.
While optimistic about the current pull-back cycle nearing its peak, Sadaani anticipates a resurgence of venture capitalists (VCs) and investors in robust businesses in the coming months. However, he maintains a cautious approach, conserving cash to invest solely in the best companies. As an investor, he encounters many high-quality businesses and founders but lacks the capital to deploy in all of them.
Sadaani adopts a strategy of placing bigger bets on founder-space combinations in which he has a higher conviction. However, he acknowledges that the outcome of such investments remains unclear until several years into the business cycle.
Sadaani observes that businesses that have demonstrated significant growth and established strong profit and loss statements (P&Ls) in the past 12 months currently attract the most investor attention. Additionally, he foresees the continuation of bridge rounds, particularly for founders and businesses that have successfully undergone turnarounds or consolidation. These rounds may serve as a means to either await valuation expansion or buy additional time for teams to complete their turnarounds.
While emphasizing the importance of focusing on unit economics and profitability, Sadaani acknowledges that in certain cases, priority shifts towards capturing the largest possible market share, especially when there is an abundance of investor funding available. He describes the balance between growth and profitability as cyclical, noting that the current environment leans heavily towards a profit-focused approach.
Sadaani expresses optimism regarding the entrepreneurial landscape in India and highlights the creation of exceptional businesses in various sectors. He prioritizes investments in Software as a Service (SaaS), climate technology, consumer brands, and internet and artificial intelligence (AI) enablers, recognizing their potential for growth and success.
Mohit Sadaani, co-founder of The Moms Co, maintains a focus on businesses with strong fundamentals and high customer demand when making investment decisions. While navigating the current investment climate, he conserves cash for investments in select companies, placing larger bets on founder-space combinations he has a higher conviction in. Sadaani recognizes the prominence of businesses that have displayed resilience and achieved consistent growth, and anticipates the continuation of bridge rounds for companies undergoing turnarounds. As an advocate for balancing growth and profitability, he believes the current landscape emphasizes profitability. With an optimistic outlook on the Indian entrepreneurial ecosystem, Sadaani prioritizes investments in SaaS, climate tech, consumer brands, and internet and AI enablers, recognizing their potential for success in the evolving market.
