I believe that India is or will be one of the core venture capital investing hubs of the world. Not surprisingly, the Indian private equity markets are hot. By many accounts, there are over 30 INDIAN venture capital, private equity, real estate and other funds in the fundraising process right now.
Battery Ventures is actively investing in India. We have made an initial investment in Tejas Networks and are seeking additional investments. The best place for us to build our activities is to focus on the needs of our “customer”, the entrepreneurs. I believe that the most important elements for funding Indian entrepreneurs are:
- A long term commitment to India with personnel (frequent trips or local presence), budget, and process.
- A global network of customer relationships and strategic partnerships, primarily coming from current and past portfolio company investments.
- A network of entrepreneurs who could act as domain or functional advisors to the company or potentially fill positions as the company scales.
- A network of LPs, banking relationships, and corporate development relationships to advise the company on private placements, IPOs, and M&A.
- A deep portfolio and numerous consultant and professional services relationships on which to draw best practices benchmarks and information around customer acquisition, sales, channel, traffic acquisition, marketing, development, engineering, supplier relationship management, manufacturing, etc.
Having visited India actively over the last two and one half years, we have been building out our relationships with first and foremost the local entrepreneurial community as well bankers, lawyers, accounts, search firms, angels, incumbent companies, etc. Additionally, we have been watching what others in the eco-system have been doing in the Indian market.
Personally, I am most interested in the venture and growth equity segments of the market. It’s a large and rapidly growing set of firms. And to keep things interesting, there are many different approaches. To help make sense of it all, I pulled together a quick summary of various strategies currently being deployed. It helped me get my arms around all that’s happening, and I thought others might find it a useful way to view the evolving market.
Summary:
Strategy |
# |
Firms |
India VC funds raised or likely to close |
8 |
Helion1, Inventus1, Matrix India1, NEA IndoUS1, Nexus, Oak1, SVB1, Sequoia India (Westbridge)1 |
VC firms sponsoring India VC funds |
7 |
InterWest, Matrix1,2, NEA2, Oak1, Sequoia, Sutter Hill, USVP2 |
VC firms seeking to sponsor or raise a fund |
5 |
Unannounced Top Tier Fund, DFJ, Unannounced Top Tier Fund, IDG, Venrock |
VC firms which have hired a GP/VP and building presence in India |
6 |
Bessemer1,2, Canaan1, Clearstone1,2, IFC, Kleiner Perkins, Softbank Asia International |
VC firms with a US partner solely focused on India |
2 |
|
VC firms with an Active Commuter Model |
8 |
Artiman1, Bluerun, Columbia Capital2, Gabriel2, Norwest2, Sierra, Trident2, Walden International2 |
VC firms with a Passive Commuter Model |
14 |
Accel1, Austin Ventures2, BA Ventures1, Charles River, DCM-Doll1, Diamondhead1, FTV, Francisco1, Globespan1, Sevin Rosen1, Shasta1, Sigma, Storm Ventures1, Telesoft1,2 |
VC firms looking to hire an India GP |
1 |
|
Corporate VCs with a presence on the ground |
3 |
|
Corporate VCs with an Active Commuter Model |
3 |
|
1 Firm or individual is a member of US-IVCA, which is focused on US and Indian Venture Capital related issues www.us-ivca.org |
||
2 Spending time in SVBs Bangalore office |
||
Battery’s strategy is to continue to spend significant amounts of time in India.
- Carl Stjernfeldt led Battery’s investment in Tejas and is focusing on Indian companies in the components, infrastructure and communications services arenas.
- I’m focusing on Indian companies in the consumer Internet, mobile, software, BPO, ITES and technology enabled services arenas.
- Ramneek Gupta just joined us from ITU Ventures and will be driving a significant portion of our efforts in India.
Needless to say, that’s a lot of firms and a lot of money being raised. Stay tuned and I’ll share some of the ‘under the cover’ details in an upcoming post.
