Sajan Pillai To Help Accelerate Investments In B2B Startups In India, US

After launching a venture capital fund, UST Global’s former CEO Sajan Pillai has now set up a new entity to support investments in B2B startups. 

Pillai has reportedly set up McLaren, with a team of former McKinsey, PwC and EY consultants and former CXOs, to enable investments in B2B startups in India and the US using next-gen technology.  

McLaren will have an outbound strategy, where its team would help startups in their portfolio to access global markets and an inbound strategy, where it will focus on identifying and investing in cutting-edge work.

Pillai had created a startup success story at UST Global, a mid-size tech services firm, retired as CEO of the company, however, the serial entrepreneur has already stepped into multiple roles and have started yet another inning as VC and a healthtech startup founder. 

Having associated with UST Global for two decades, Pillai has been closely following the startup ecosystem for the last decade. He was also instrumental in shaping the innovation strategy at UST.

Pillai launched his Season Two Ventures in Bengaluru recently, which has a corpus of $100 Mn. Through this, Pillai and his team will make initial investments with a ticket size of $500K-$2 Mn. Season Two Ventures has chosen to invest in B2B startups exclusively.

In an earlier interaction with Inc42, Pillai said, “The B2B segment is a bit more predictable. Second, is our expertise which has been mostly in B2B. Third, according to our research, B2B companies find it very hard to get a proper distribution network. So, if we could create a distribution and advisory system for the scalable B2B startups, this will be a great value-creation for these startups.”

Season Two plans to invest into four sectors —  banking and fintech, healthtech, utility and energy, retail and logistics, Pillai had clarified.

With such a huge population, India is primarily a consumer market, but with the rise of small and medium businesses, MSMEs and startups, the business-to-business model has also gained prominence in recent times. With 13 B2B startups in the Indian unicorns club, India’s B2B sector is undoubtedly growing in stature and size.

As per Datalabs by Inc42, B2B startups recorded compound annual growth rate (CAGR) of 21% in the funding amount between 2015-2019, which is the highest the sector has ever witnessed. The report adds that the median funding amongst the B2B and B2B-B2C startups was $4 Mn, whereas, in the case of B2C startups, the median funding amount is $3.5 Mn. So B2B startups are not only seeing more funding, but also bigger deals.