Radhika Ghai co-founded ShopClues, an e-commerce platform, back in 2011. She ran her venture in the face of serious competition from Flipkart and Amazon for seven years. Not surprising that Ghai believes risk-taking comes naturally to her. “As an entrepreneur, your risk-taking capacity is higher and better than a lot of people. It’s your job to tackle risk,” says Ghai.
Her approach to personal investments is pretty similar. One asset class that is close to her heart is start-ups. It wasn’t so five to six years back, when they formed less than 5% of her investment portfolio. Today, it stands at 15%, with equity and real estate making up for the rest.
Ghai had earlier kept away from the volatile asset class of start-ups to optimise her lifestyle. “I was looking at building up my real-estate allocation and I today own a primary and a secondary home,” she says. Besides the two properties, Ghai has made a few other investments (both residential and commercial) in smaller towns.
But start-ups is what Ghai is excited about. To ensure she backs up the right start-up founder, Ghai considers three factors before making an investment — total addressable market, the idea and the team — the most critical element.
But investing in the new asset class can be very risky. “I have investments that have gone down to zero, and there are others where I’ve made 10x return. It is volatile asset class and the results can be binary,” adds Ghai.
Of the six investments, she made good return in four and lost money in two. “Probably the timing of the two was wrong,” feels Ghai.
In equity, she takes the help of professional advisors and her father. “I take help but want to know what is going on,” she says.
Ghai believes being an entrepreneur has also helped her mature as an investor. “My key investing philosophy across asset classes is to understand the risk and contain it,” she says.