Bangalore : India is all set to become the centre piece of the jigsaw puzzle that global investors and investment firms are putting together. With each investor scouting actively for his share of the start-up pie, the key idea is to pump in money to net those billion dollar business ideas and create large scale synergies between businesses. In the past few months, well known venture capitalists with deep pockets backed by their investment arms, have set their sights on India with a view to creating a network. The result: value chains crisscrossing to form a network of investors (both individuals and institutions), cross holdings and shared markets and benefits. "What the market is seeing is a complete network of VCs and investors coming together.This gives the investee companies access to global markets and shared benefits/business while the investors get a chance to spread their holdings across a number of companies," according to an industry analyst. One example is the US-based Global Internet Ventures (GIV) promoted by William Melton (founder Verifone and Cybercash). Ready with a war chest of $150 million for strategic investments in IT companies in India and China, the venture fund is looking at creating a whole backbone of companies connecting the US, India and China markets. "We are focused on the cross-border nature investments, with significant operations in India but serving global markets.
By creating this value chain, networking with portfolio companies, customers, technology partners plus VC-related activities like corporate governance, HR, and working with the capital markets are definite advantages," said GIV managing director Jeff Tonkle. Another interesting aspect to this network is the extensive focus on consulting and mentoring, as this opens up avenues for bringing in industry experience and third-party objectives/relationships. To this end, VCs are now lining up advisory and consulting panels consisitng of Silicon Valley biggies, including well-known names like Mr KB Chandrasekhar and Mr BV Jagdeesh (founders of Exodus Communications), Bill Melton, etc.
For example, Bangalore-based Sivan Securities has joined hands with Bank of America Equity Partners to fund IT start-ups through its venture funding company -- Global Technology Ventures. Mr William Melton and Mr BV Jagdeesh also have made token investments in the fund. Aiming at being the preferred seed stage funding partners, the company is currently setting up a whole incubation village for its investee companies together with an impressive advisory panel.
"While VCs fund companies independently, networking with other investors and companies can help create significant synergies between businesses," according to GTV managing director Mr VG Siddartha. Powered by Silicon Valley success Mr KB Chandrasekhar, yet another Bangalore-based incubator -- e4e Inc -- claims to be India's first technology holding company. With an outlay of $300 million for India-centric investments in start-ups, this initiative is aimed at being both a technology enabler as well as a business incubator.
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