Based in Mumbai, India, Muzumdar evaluates mergers and acquisitions as well as investments, partnerships and alliances for Amazon.
In August, Google became Alphabet. The company once known solely for Internet search has expanded well beyond its core business, and, as of August, has been restructured as a holding company for a number of business units, from an Internet search and advertising unit (still called Google) to smart thermostat-maker Nest and health research company Calico. Amazon, once solely an e-tailer, has similarly invested in new areas, ranging from cloud computing to phone manufacturing. Such diversification has become the norm for technology giants trying to catch the next wave of profit and innovation. Some bets pay off. Others don’t. How do companies find sound investments? Abhijeet Muzumdar, M.B.A. ’04, head of corporate development and investments as well as mergers and acquisitions at Amazon, shared some expertise.
Based in Mumbai, India, Muzumdar evaluates mergers and acquisitions as well as investments, partnerships and alliances for Amazon. “The investments we make are very similar to how venture capitals make their investments,” he said.
For Muzumdar, the comparison is especially apt, as he spent more than six years at Bessemer Venture Partners, the backer of some of today’s biggest brands—from Staples to Skype. While there, he invested large amounts of capital in a number of now-thriving companies. Among his Bessemer investments were bharatmatrimony.com, India’s largest matrimonial classified site, and snapdeal.com, a prominent Indian online marketplace.
He has spent more than a decade honing mathematical models that guide him. He also carefully observes trends, particularly in technology and e-commerce in India. “E-commerce has changed the way this country buys products,” he said. “It’s changed the way customers in India exchange products. Both small and large enterprises, who have always been offline, have started leveraging online platforms. Technology has grown their business.”
Seeding companies and nurturing their growth is a source of satisfaction for him. He served on the boards of the companies he invested in while at Bessemer.
So far, at Amazon, he has guided investments in QwikCilver Solutions, a Bangalore-based e-tailer providing online gift card solutions to retailers and corporations, and bankbazaar.com, an online marketplace for loan, credit cards and insurance quotes and products.
Muzumdar spoke about his valuation strategy and its roots in an M.B.A. course he took while at Adelphi’s Robert B. Willumstad School of Business: Building Shareholder Value taught by Daniel Verreault, Ph.D., now an associate professor of accounting at the University of Tampa.
“I took the class twice,” Muzumdar said—first for his own edification, then for credit. “It was a fantastic class for someone who wants to get into financial services,” he said. “It really helps build a strong base on how you value a company, how you build spreadsheets for valuation formulas and what venture capitalism is.”
Muzumdar explained that he has created a fund strategy for technology investing, and while numbers are important, a successful investor will be a good trend spotter and have a strong conviction in the space he or she is funding
“It’s a lot to do with conviction, it’s a lot to do with your research; a lot to do with what you believe and why you believe it,” he said.
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