Global Corporate Venturing Rising Stars Awards 2018: #5 Russell Dreisenstock

“When looking at technology hotspots outside the US, it is difficult to see past India. Home to 1.3 billion people and the world’s seventh largest economy, India is also the birthplace of an outsize influence in Silicon Valley, due to a large diaspora of talent spread across both startups and established technology companies – look no further than the top executives of two of the world’s top five most valuable companies, Satya Nadella at Microsoft and Sundar Pichai at Google,” wrote Russell Dreisenstock in an article for Entrepreneur.com in September 2017.

It is no surprise then to discover that Dreisenstock has been particularly focused on India in his role as head of international investments at Naspers Ventures, the corporate venturing unit of South Africa-listed media and commerce group Naspers.

Some of the deals Dreisenstock has led on for India-based companies last year included a $71m investment in e-commerce firm Flipkart, $250m for Ibibo Group, which owns and operates bus ticketing platform redBus.in and hotel booking site Goibibo.com, and providing $60m of an $80m series E round for online food ordering platform Swiggy.

For this profile, Dreisenstock called Flipkart one if his greatest successes, citing the low valuation at Naspers first entry and the “exceptional” returns it has produced. But what is it about India that makes it such a target-rich area for investment?

In his Entrepreneur article, Dreisenstock cites the characteristics present in Indian culture that have a positive influence on the country’s startups. They are: bargaining/negotiating, respect for experience, community and jugaad – an Indian concept that he defines as “the most innovative, economical and quality method to accomplish the desired task by unusual or imaginative means and ways”.

However, India is by no means the only part of the world Naspers is interested in. Food delivery platforms around the globe appear to be one of the areas beyond media and e-commerce that firm is keen to move into, having invested approximately $1.2bn in such companies in 2017.

Germany-based Delivery Hero received the majority of that money, approximately $1.1bn. Naspers first provided $423m in May before investing further at its initial public offering  and afterwards, buying secondary shares from e-commerce group Rocket Internet. Dreisenstock said Naspers has already seen 1.5-times return in just a few months and it planned to stay in the company for the long term.

When nominating Dreisenstock as a Rising Star, Larry Illg, CEO at Naspers Ventures, said he had driven many of the firm’s food investments. In addition to Delivery Hero and Swiggy, it has South Africa-based Mr Delivery and Brazil-based iFood in its portfolio.

Dreisenstock joined Naspers in 2000 and worked his way through a series of regional business development roles before becoming head of mergers and acquisitions in 2014 and then transitioning to his current role at Naspers Ventures in July 2016.

His career at Naspers has taken him around the globe, starting out in his native South Africa before moving him to Singapore and now the US. This global focus can be one of his biggest challenges, as his team is working 24-hours a day across offices in different time zones. While this means work can be handed off to the next time zone starting their day, it does necessitate working around the clock more often than he would like, taking him away from his two young daughters.

Talking about what he hopes to achieve going forward, he said: “My main ambition is to open up new vertical segments for Naspers in innovative and exciting new areas that are addressing huge societal needs.”

Alongside food, one of the new verticals he listed was education, which has already been an area of significant investment since Naspsers Ventures was set up in 2015. The initial deals under Illg and Dreisenstock targeted Codecademy, which is “teaching the world to code”, Udemy, a learning and teaching marketplace, and Brainly, the world’s largest social learning network with 70 million-plus users.

According to Dreisenstock, one of the reasons that he has been so successful at Naspers is that the firm’s philosophy is to invest for the long term and this allows him to structure deals that are founder-friendly and offer operational support. He said this was what corporate venture capitalists needed to do to be more competitive against traditional VCs.

“They should also continue to nurture the startups and let them act on their vision without immediately imposing a corporate way of doing things or harnessing them to do just what the corporate ambition may be,” he said.