If an angel investor in multiple tech unicorns is starting up, one would bet that they are creating an app with an addressable market of millions, if not billions, of users.
Not Utsav Somani. Having backed founders of startups like CoinDCX, Jupiter, BharatPe, SUGAR and others who went on to cumulatively raise thousands of crores in funding for their digital platforms, he now wants to take his captive audience offline.
Somani's club for elite tech entrepreneurs, a startup called Offline, has raised $2 million in funding from co-founders of companies such as Groww, Razorpay, Polygon, CoinDCX, Shiprocket, Ultrahuman, BharatPe, etc.
“You have your home. You have your office. But, what’s the third place — like our elders had gymkhanas — for the new generation of tech founders? We are building that third place,” Somani said.
While his previous role involved leading the India chapter of AngelList, a platform that connects startups with potential investors, Somani's latest venture takes inspiration from Hampton, a community of high-growth startup entrepreneurs and CEOs based in the US, founded in 2022.
According to him, Hampton is already running at an annual revenue rate of $7-8 million and has 7,000 startups on its waitlist. It’s hard to get into the club — you must have built a company with $1 million in revenue, or raised $3 million in funding, or exited a startup worth $5 million to be eligible. Even after that, applicants are vetted for a culture fit and it is ensured that they are building a digital-first business.
But, Somani’s Offline wants to make it even more exclusive — it is setting the bar higher for applicants at $5 million in revenue, or $5 million in funding raised or $10 million in a previous exit. After that, there will also be the mandatory screening process to check the founder’s fit with the network.
“All of this mess that is going on in the ecosystem… I think you want to be anti-mess in the sense that you want to stay away from all the noise and the buzz that's going on in the ecosystem around bad governance, bad ethics and stuff… We want to take our time to get to know the members pretty well, so that we can cater to their needs,” he said.
According to Somani, there are around 800 startups in India which have raised $5 million or more in the last 3 years. Assuming that each of them has two co-founders on an average, the catchment area is around 1,600 founders. As CXOs of these startups would also be eligible to apply, the addressable market could be a few thousand high-net worth individuals in the tech ecosystem.
To start with, the annual membership to the club would cost Rs 5 lakh. This money would help Offline be in the black, while organising getaways, executive coaching, therapy sessions and talks by eminent thinkers. It has already held seminars with noted paleontologist Louise Leakey on fossil hunting and with Oxford mathematician Marcus du Sautoy on artificial intelligence and creativity.
“These entrepreneurs don’t want to hear from the same set of unicorn founders again and again… They have already been through that journey,” Somani said.
The second — and more important — monetisation plan for Offline is to sell alternative assets to its members. The idea is that these members, who may currently only have paper-wealth based on their companies’ valuations, will eventually become wealthy in cash. And that’s when wealth managers and the like will be ready to ‘pay a pretty penny’ and get access to this group of rich individuals.
While the jury is still out on how many of the high-growth startups that raised funding in the last few years at top valuations will survive the ongoing funding winter and make money for shareholders, Offline’s model seems to be in stark contrast to its audience’s.
The club asks for a high subscription amount upfront, targets only a niche market of a few thousand individuals, doesn’t involve high customer acquisition costs and plans to be profitable from Day 1.
Is this a sign of the times we are living in — would Somani have started a platform with the potential to scale to millions of users in another time? He doesn’t have a straight answer.
“I think we closed our seed round pretty quickly and easily. From the perspective of scale, if I am able to get 600 of the most interesting startup founders in India, it would be a tremendous market to access. Once you get their trust, there’s a lot of potential financial play. We will reveal our plans as we go along,” Somani said.
“Imagine it to be a Cred, but for elite tech founders,” he added.
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