[EXCLUSIVE] Harshil Mathur on Journey of Razorpay, User Specific Fintech the & Raising VC Money

Summary

The speaker discusses the challenges of being a young entrepreneur in the banking sector and emphasizes the importance of startups in driving innovation. He shares his journey with Razorpay, focusing on solving payment issues for businesses and building a brand that resonates with entrepreneurs. The talk also covers the importance of product-market fit, the role of capital in business growth, and the future of fintech, particularly in B2B and complex financial solutions.

Takeaways

• 😀 The founder of Razorpay was advised to look older to be taken seriously in banking meetings, highlighting the challenges faced by young entrepreneurs.
• 💼 Razorpay's new features often originate from the founder's own experiences and the needs expressed by other startup founders.
• 💰 Raising capital comes with an expectation of aggressive growth; the more money raised, the harder it becomes to achieve the required 10x return.
• 📈 Razorpay's product-market fit realization came gradually, with a significant indicator being when people started searching for 'Razorpay' instead of general terms like 'payment gateway'.
• 🔍 Razorpay's approach to product development is deeply rooted in understanding and solving the problems faced by entrepreneurs.
• 🏢 The company's culture emphasizes building products that cater to the needs of business owners, steering clear of features that are just trendy.
• 📊 Razorpay's growth and diversification strategies include maintaining a strong balance sheet to secure regulatory approvals and expand into credit services.
• 🤝 The company has a history of partnerships and acquisitions aimed at enhancing its capabilities and addressing pain points for startups.
• 💡 The founder's personal investment philosophy focuses on the potential of the founder rather than the sector, emphasizing the importance of the team behind a startup.
• 🚀 Razorpay sees opportunities in disrupting traditional B2B financial services like invoice discounting, which are ripe for technological innovation.
• 🌐 The potential introduction of a central bank digital currency (CBDC) is viewed as a massive opportunity for the fintech industry, possibly streamlining settlement processes.

Q & A

What advice was given to the founder of Razorpay about looking older to be taken seriously in banking meetings?

The founder was advised to wear a suit, grow a beard, and look older to be taken more seriously in banking meetings.

How does Razorpay's founder approach building new features for the company?

Razorpay's founder builds new features by talking to entrepreneurs and understanding the problems they face, focusing on what they hate spending time on and what they feel should be built for them.

What is Razorpay's strategy for product development?

Razorpay's strategy is to be the first to launch new payment technologies and features, such as UPI, UPI auto pay, and tokenization, by keeping a close dialogue with entrepreneurs.

How does Razorpay's founder describe the company's culture and its focus on startups?

Razorpay's founder emphasizes that the company's culture is deeply rooted in building for entrepreneurs, with a DNA focused on performance and a commitment to solving the problems he himself faced as a startup founder.

What was the initial challenge Razorpay faced when starting out?

The initial challenge was the complexity and time-consuming process of integrating with payment gateways, which could take an average of three months to go live.

How did Razorpay realize it had achieved product-market fit?

Razorpay realized it had achieved product-market fit when it started receiving organic search traffic from people looking for Razorpay specifically, rather than general payment gateways.

What is Razorpay's approach to brand building?

Razorpay's approach to brand building is based on consistency and a clear focus on the principles the brand stands for, ensuring that every product built is in line with the needs of entrepreneurs.

What are the future growth areas Razorpay is looking to diversify into?

Razorpay is looking to diversify into credit solutions with the launch of a corporate credit card and simplify banking activities for businesses.

How does Razorpay's founder view the role of capital in a startup's growth?

Razorpay's founder believes that while raising capital can be necessary for aggressive growth, especially in areas requiring significant upfront investment, it's crucial to be aware that it commits the company to a path of rapid scaling and the need to deliver substantial returns.

What advice does Razorpay's founder have for entrepreneurs regarding fundraising?

Razorpay's founder advises entrepreneurs to be clear about the implications of raising money, understanding that it commits them to aggressive growth and the need to deliver on investor expectations.

How does Razorpay's founder approach equity investments in other startups?

Razorpay's founder focuses on investing in early-stage companies, primarily based on his belief in the founders, rather than the sector or the specifics of the business.