or the entire last decade 2008–2018
Is Undoubtedly Lee Fixel of Tiger Global.
Every founder attempts to create value. It is not that hard. If money is handed out for a purchase, it is bound to create a consumer surplus. As Bill Gurley, legendary VC at Benchmark Capital says
To turn it into a business it is critical to capture some of that value back. Best founders are those that are good at capturing value after creating it. Capture that value for themselves, investors and employees.
Employees even in a typical valley based startup don’t make much money. As Hunter Walk, VC at Homebrew Capital says
Lee made two of his employees near billionaires and close to 200 others multi-millionaires.
When Lee first moved into India he was branded a casino capitalist. But thanks to him the entire venture capital industry that was being questioned for returns got two decades worth of lifeline to continue.
As per the research by Prof Thillai Rajan in 2018, “Mean returns of Indian PE-VC startups investment is 13.25% in the decade 2008–2018”. In the US these return average 15–20%.
In the previous decade, i.e 1997–2007, many reputed global VC firms that came to India bolted back due to inadequate returns. In the next decade till 2017, about $16b of investment by VC had been done in India. Only $4b had been recorded as exits. By orchestrating Walmart Flipkart acquisition in 2018 Lee added $17b to the tally of exits to take it to $21b.
Else the 13.25% return of the VC asset class may not have been possible.
For just that one reason he must be celebrated.
Even technology natives like Google, Microsoft, Intuit, Yahoo have a poor track record in integrating and digesting an acquisition. It will be harder for a non-digital incumbent like Walmart. It is anyone’s guess whether Flipkart will be an albatross on Doug McMilon’s (CEO of Walmart) neck. Chemistry between Walmart and Flipkart culture seems like water and oil, not something that is easy to mix.
But that is a story for another day.
A tremendous amount of wealth transferred into the hands of commoners who could have otherwise not imagined hitting such a jackpot.
For his stellar performance, we cherish Chris Gayle as our top IPL player. Similarly, Lee Fixel is our best Indian startup founder.
He showed how to capture value, spread wealth to startup employees and saved the entire VC Industry in India.
Disclaimer: I am in no way connected to Lee Fixel or Tiger Global. Have never met him. Neither did he influence any of our common friends to write this 🙂
Just admiration for someone who fueled a new reality.