Silicon Valley venture firm to fund Indian start-ups

June 24th, 2008 - 8:43 pm ICT by IANS  

Bangalore, June 24 (IANS) India-born investors from Silicon Valley have joined hands to fund Indian start-ups in the technology sector with seed capital and mentoring. The US-India venture firm Inventus Capital Partners (ICP), co-founded by US-based entrepreneur Kanwal Rekhi, has raised $125 million (Rs.5.4 billion) from global financial institutions to invest about $1-10 million in 15-20 early-growth companies floated by Indians in software products and services domains.

“We have already lined up two start-ups, including one from Bangalore for funding,” Rekhi told reporters here Tuesday.

“The other is set up in Silicon Valley by two Indian-born entrepreneurs, with a software development centre in Bangalore. The nature of funding and other details will be announced after we finalise them.”

Other partners in the venture firm are co-founder John Dougery from Silicon Valley, and early-stage venture investors Samir Kumar and Parag Dhol. Along with Rekhi, the partners jointly hold about 10 percent of the venture fund, with the balance (90 percent) coming from institutional investors, including pension funds.

ICP will be assisted by serial entrepreneur and early venture capitalist Saurab Srivastava, Stanford University professor and start-up advisor to Google and Yahoo! Rajeev Motwani, Silicon Valley-based serial entrepreneur B.V. Jagadeesh, and former president of Wipro research and development (R&D) Sridhar Mitta.

“We are here to back ambitious entrepreneurs build next-generation technology powered firms in software products, services, embedded software, consumer internet, semiconductor and mobile services,” Rekhi said.

With two decades of expertise in technology-based entrepreneurship, Inventus principals have in over 100 firms through multiple venture cycles since 1993.

“We typically lead the first round of funding and play a mentoring role on company boards,” Dougery said. “Besides mentoring, we will provide a host of advisory services from technology, operations, training, talent-building to marketing and client servicing,” .

With India emerging as the global design centre for software products, Indian entrepreneurs and enterprises have the potential to tap a $50-billion global market.

Similarly, in the services domain, start-ups have immense scope to leverage the domestic IT and knowledge processing outsourcing industry, estimated to generate about $80 billion, including 80 percent from exports to global markets.

ICP plans to invest in start-ups catering to India, Asia and global markets in multiple verticals such as mobile applications and services, social networking, video and gaming, multi-platform commerce, direct marketing and advertising and software as a service.

“Indian entrepreneurs have tremendous opportunities to offer technology products and services to diverse verticals like travel, entertainment, logistics, retail, energy and information in the sub-continent and healthcare, legal, financial, research and education in global markets,” ICP managing director Samir Kumar said.

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