The Omega Files - The “Why did you do it?!” Question | Part II

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Part II: The Director's Cut

Dec 14 2023: Public message that we will be Declassifying The Omega Files

Dec 15 2023: Omega Files Ep 1 launched in the public domain

The most common question I got in private DMs was “But Why did you do it?”

You saw my colleagues’ responses to the question I had asked them - “Why do you think we did it?” (responses here)

For me, personally, it wasn’t about any one thing in particular. A legendary mentor once told me that the greatest strategic moves are to be thought through and justified in your head in as many dimensions as possible. This was a humble attempt in that direction.

Here is my sincere set of reasons: most encompass the raison d’etre of Venture Capital.


Only reason to be in venture capital is to Play the Looonnnnggggg game!

And if we managed to deliver as early as Cycle 1, we have hopefully learnt enough lessons that we won’t screw it up from hereon. It’s with that confidence that the disclosures made sense.

It is incredibly daunting that this has nothing to do with just a tiny Fund I, but forces us to be prepared with similar disclosures for the many funds that will come. Fund IV is ~20x the size of Fund I. Where will its performance be a decade from now?

We will need to bare our soul, heart and most importantly, subject ourselves to the harshest critics and critiques of Indian VC and Blume. People seem to just need any simple excuse to trash the decade plus years of work that goes into building out a Venture Fund from start to finish. There is very little respect for the Fund Manager’s efforts in fuelling the entrepreneurial energy with that earliest institutional cheque and, at the least, our service to entrepreneurship should be on display.

Damned if you do, damned if you don’t; so, …Let’s Do It!

It’s amazing that the public market spectators to this sport drill things down to one and only one aspect - “damn all that effort people, just tell me what the IRR was and how it compares to small caps, since that’s where your risk / reward belongs.” That was the most asked question on the social media timelines when we published the Omega Files. So, performance questions are never going away.

What is the rationale of NOT disclosing how a fund went? I don’t see any point in the non-disclosure at all. The LPs who will judge you will do so irrespective.

It’s your life’s work. It influenced so many founder journeys, the tens of thousands of jobs they created in turn and the millions of customers their product or service influenced. What’s not to be proud of? If you underperform multiple cycles, the fund house will fade into the sunset slowly. Non-disclosure doesn’t change that.

If you outperformed, you are writing the playbook for the next generation of Blume partners internally and other peers externally, to do it better. The harsh truth is that even internal believers or doers need external validation of their predecessors’ investment strategy and decisions in venture, more so than in any other asset class. The courage to put this out in the public view in itself gets us more respect from both my colleagues, my co-investors and my fund investors.

Every LP wants a hundred FAQs answered to them individually

Go on ladies and gentlemen! Try us! :)

What other slices of data and reasoning and impact would one like to see? We can try and publish that too in the future editions of the Omega Files (next one slated for Dec 2024). The decision to invest or not in Blume then becomes clearer, since we’ve publicly shared the same information with everyone. The intent is to democratize the learnings of our journey across all stakeholders. Suddenly, founders know why they pick Blume as do co-investors as do investors - individual, family office or institutional.

Accountability for (what is also) taxpayers’ money

Every Blume Fund has sources of capital that belong to taxpayers of India, amongst other nations (sovereign funds). Some of this overseas sovereign capital may simply be economic surpluses but I’m sure that this is not the case with India. Whether it was TDB (Technology Development Board) (Fund I) or SIDBI (from balance sheet, Fund IA) or India Aspiration Fund (administered by SIDBI, Fund II) or Fund of Funds Scheme (FFS) (administered by SIDBI, Funds III and IV), we’ve been fortunate to be entrusted taxpayer money.

As if the pressure from LPs isn’t severe enough, we implicitly have this additional moral pressure, to deliver. All capital in each respective fund acts as one pooled vehicle. We come to work to outperform for everyone’s contribution. So, the thrill of doing so for Indian taxpayers alongside other best in class private and global investors, in the same fund, is an adrenaline rush (even if a decade-long delayed gratification).

We think we owe it to the public assets we dip into, to show them the impact of their capital to the entrepreneurial waves it can create, apart from the impact beyond simple financial returns. There’s much more learning and scale of impact to showcase here and we hope to give it its due in future editions of the Omega Files.


Increasingly, founders are put on a pedestal but one shouldn’t forget that the implicit corollary for that placement in rarer air, is for the courage, integrity and honesty with which they take on the problems of the world. There is no shame in failure if the effort is valiant. But to assume that bad practices or behavior will not be highlighted or called out, in as much as the best in class will be showcased, is a bit naive.

The mistakes are there to teach us all; as much as the success stories do. No one is seeking to call out specific companies other than when they become absolute winners. However, if you’re a Blume company, now or in the future, one should imagine that you will be showcased or not for the right reasons. Founders also need to make a call on why Blume is a partner of choice on such long and arduous journeys. Money is fungible, a true long-term partner is not.


Regulators will humbly admit that there are several things about our business model that they don’t fully understand but will yet carpet bomb us Indian funds (AIFs) with regulatory stumbling blocks before we’ve grown out of infancy, while allowing foreign capital to compete (relatively) freely.

Atmanirbharta (the Hindi slogan for “self-reliance”) is somehow not a priority for the Government to create, for early stage VCs. It seems it is important that we generate thousands of startups with the least amount of capital lost, but when we explain the regulatory framework we need to enable that, there’s no real audience. The message seems to be that we are too small to matter on one hand but when it comes to taxes, risk capability and rich pools of capital funding us, we are too risky to let be. There is a reason private markets stay private but we don’t seem to be getting that memo as a nation - choking a fledgling industry. Improve the right amounts of disclosure if needed to weed out bad actors but asking us to compete on a global capital market with one hand and one leg tied behind our backs is unlikely to create world-class fund houses in venture. The VC industry can singularly shift the entrepreneurial orbit of the country more than anyone else, IF there is a level playing field. There is not even remotely a level playing field at this moment.

The Blume team

I’m occasionally shaken by the lack of faith from our own team members in the craft of Venture, if not Blume. Venture is not a perfect craft anywhere in the world and we keep evolving. Debates and incisions into past strategies inform us well into the future ones.

However, colleagues leaving us was something that struck me hard when the first ones did 6-7 years into the Blume journey. Everyone has their reasons but one of them was definitely a misalignment between their love for the craft, its long-term nature and the ups and downs.

New colleagues join us, each new vintage of them better informed about Blume and VC, but yet seemingly more intrigued about other funds and their managers, while wielding limited information about them (or interactions with them), rather than appreciating our own craft in the context of how our own funds were built, in the context of the vintage and size we were then.

Venture Capital is a business where the next generation takes the torch from our hands if the franchise is to outlive the founding partners. What better way to instill that faith in the craft and instill confidence by building, sharing, learning in public.

Also, the daunting nature of building each fund in public is then not mine to carry alone. Interestingly, it’s a bold warning flare to everyone in the firm - it’s not just Blume’s totality of track record that will be showcased to the world, every individual investor at Blume shall also disclose their superb performance or misses and explain them to the world. No one expects perfection, but everyone would like to know what worked or didn’t and why? So, we are also letting the team, current and future members, know the humbling nature of taking other people’s money and being answerable for it over a decade and more at a time.

I think it will push the entire team to become best in class in everything we bring, of ourselves, to the workplace, every day. There is no short-term reward in our business and we don’t need anyone with that mentality to be on a team that hopes to create “winning” as a perpetual long-term mindset.

Pressure is a privilege!

Managing the riskiest asset class on the planet, when you haven’t faced the investors yet, is a privilege!

Wear these privileges dutifully and respectfully.

Power Law

Fortune favors the prepared mind is the adage that wins the venture game. If one were to add to it, it would be “fortune favors the prepared mind and hard working soul”. The power law is an outcome of incredible input funnel planning and discipline, including thesis areas, founder-market fit, founder-VC firm fit, risk planning, etc but also needs to be combined with sheer hard work on everyone’s part - not just the founder and team, but also the investor. Ultimately, it still takes the founders’ lucky stars and lucky breaks for generation-defining firms to emerge.

If one writes case studies of all the winners, everyone of them shows this path, without exception. So, that deep commitment to the venture, respect for all stakeholders and path to sustainable businesses is the playbook we would always like to showcase. The lucky breaks will emerge magically along the decade’s journey, scripting the Power Law from theory to practice.

The Power Law is written by the orientation of the stars, everything else is written by the hands that wield the venture craft.

Emerging managers

Why not learn from the mistakes and successes of the OGs? Everything from fundraising, portfolio construction, founder selection, value add, sector specificity, team construction, share of rewards and end state math in a successful fund - everything is being or will be laid threadbare, no imagination or simulation required.

Yes, the environment has changed drastically and will continue to evolve but first principles of the business stay relatively unchanged. We hope the declassified Omega Files help dozens of emerging fund managers, not just in India but globally. It’s our small way of paying it forward, with a touch of gratitude to those who believed in us as investors and the grit of the founder journeys that got us there.

Marketing & PR & Thought Leadership

Is this what I needed for marketing? Is there a marketing hack without performance? Isn’t just putting out the Fund multiplier and an IRR number enough to brag about performance? The Omega Files was not about marketing as commonly misunderstood by many.

Yes - it’s to showcase thought leadership as has never been done before in 5-6 decades of venture history, not even from the hallowed bylanes of Sand Hill Road. That’s what we are proud of. The random silly comments of “spray and pray”, “they have no clue what they are doing”, “they are just being an index fund, not capable of alpha”, “how could they be helping companies meaningfully at this scale” and much brouhaha was endured through the first half of this fund I ride. It needed to be addressed, replied to with actual facts, figures and, ultimately, performance.

One can never know how enriching the relationships, the learnings and journeys of a VC Fund are, unless you live through the full fund lifecycle yourself. There is nothing to explain. You either experience it as a fund manager giving it their all or you don’t. But behold the success stories and the facts at the least.

The Omega Files. The Why? Part II. Fin.

You can download the Omega Files here: