Mumbai: Reliance Industries Ltd (RIL) has hired John Kuruvilla to head its early stage investment initiative, GenNext Ventures Llp. Kuruvilla, founder of defunct e-commerce start-up Taggle.com and former chief revenue officer of the erstwhile carrier Air Deccan, confirmed his move but refused to give details, stating it was “too early” to do so.
RIL’s investment arm, with a focus on start-ups, will scout for investment opportunities in new technologies, including product innovation, said one of the three persons familiar with the development, all of whom spoke on condition of anonymity.
Two years ago, RIL chairman Mukesh Ambani had contributed $200-250 million in proprietary funding to jump start private equity (PE) investments. RIL holds a 50% stake in GenNext Ventures and has infused Rs.2,00,000 into it by way of equity, according to the company’s 2012-13 annual report.
An email sent to RIL on 30 May remained unanswered.
“John (Kuruvilla) has been an angel investor for five years. Investing at an early stage is nothing new for him,” said the second person, a Mumbai-based early stage investor, who has been in talks with Kuruvilla for investment opportunities.
Kuruvilla was also founder of real estate platform Propmart Technologies (he was the CEO and MD from 2000 to 2003. The company continues without him), and chief marketing officer of travel website Via.com.
The third person, also an investor working with Kuruvilla for potential investment prospects, said it helped to have an investor with operational expertise in the early stage.
“He has operational experience in running businesses ranging from air travel to travel websites, e-commerce to real state solutions,” this person said.
In 2010, Ambani appointed Vivek Gupta, former managing director of consulting firm AT Kearney in India, to lead the PE investment venture, according to a 6 December 2010 Mint report.
For these proprietary investments, Ambani now has a team of about six people, who have expertise in investing across stages, said a fourth person who also did not want to be named and is part of this group. “It is his private wealth. We don’t want a third-party fund structure. We are a half a dozen people team with varied skill sets and expertise and can invest anywhere between Rs.1 crore and Rs.1,000 crore,” this person added.
The creation of proprietary funds by ultra-high net worth individuals (typically those with an annual income of $5 million and above) is a trend that is fast catching on in India.
Infosys Ltd’s newly-appointed executive chairman N.R. Narayana Murthy’s proprietary investment fund Catamaran Investment Pvt. Ltd invests in early to late stage start-ups. The fund has backed companies such as Tzinga energy drink maker Hector Beverages Pvt. Ltd and Bigshoebazaar India Pvt. Ltd, an online wholesaler and retailer of shoes, apparel, bags, accessories and gift items, besides SKS Microfinance Ltd.
Wipro Ltd chairman Azim H. Premji’s proprietary fund, PremjiInvest, has invested more than $1 billion across listed and unlisted firms. These include companies such as Dish TV India Ltd, JM Financial Ltd, Marico Ltd, Shoppers Stop Ltd, Koutons Retail India Ltd and HealthCare Global Enterprises Ltd.
Several companies and promoters were already making investments through angel investor networks, and now that the size of the corpus to be used for such investments has become substantial, they think it might be a good idea to do it on their own, explained Avinash Gupta, head, financial services, at international audit and consulting firm, Deloitte Touche Tohmatsu India Pvt. Ltd.
“A lot of the promoters who have been setting up such kind of family offices have a progressive mindset and are passionate about investing in new technologies. The family office structure gives them more control over such initiatives,” Gupta said.