Bengaluru: Kstart, a start-up accelerator run by venture capital (VC) firm Kalaari Capital, has invested $500,000 each in three start-ups in healthcare, financial services and online video content management.
Kstart, which invests in start-ups via convertible equity instruments, picked out the following start-ups from its first batch of entrants: Active.ai, which provides a tech platform for banks, wealth managers and financial services companies to interact with customers; Affordplan, a tech product for doctors and patients to co-design payment plans for non-emergency healthcare services; and, Indee, a web video streaming platform that helps film studios and entertainment companies to promote and test their content before releasing it to viewers.
In February, Kalaari Capital, the homegrown VC firm with stakes in unicorns such as Flipkart Ltd and Snapdeal (Jasper Infotech Pvt. Ltd), launched Kstart, putting aside $20 million for the programme over the next two years.
Kstart will invest $100,000-500,000 in 6-9 other start-ups this year, said Vani Kola, co-founders and managing director of Kalaari.
“The three start-ups that we have picked out from the first batch of more than 40 are all run by relatively mature entrepreneurs. The three fields – financial services, healthcare and online video content management – are all large and the three start-ups are also at a stage where they require that much capital ($500,000 each).”
Unlike the US, which has several successful start-up seed programmes and incubators such as Y Combinator and Angelpad, seed programmes in India have to a large extent failed to produce successful start-ups.
“We’ve done a lot of things differently (than other start-up incubators in India) such as actively mentoring start-ups, giving them access to the right and unique set of mentors and backing them with a lot of capital. Our response time to start-ups that get selected in our programme (in terms of them getting the funds) is also low at 2-3 weeks. Of course, we’ll see one year down the line what the success is, but from our side we are trying an innovative approach,” Kola said.
For its start-ups, Kstart has gathered a set of notable advisers such as former Tata Group chairman Ratan Tata, Zia Mody, managing partner at law firm AZB & Partners, senior Rajan Anandan, managing director, South-East Asia and India, Google Inc., and Varsha Rao, head of global operations at home rental start-up Airbnb.
Kalaari Capital, which started out in 2006, has some $650 million in assets under management including its third fund of $290 million that was launched last September. Apart from Flipkart and Snapdeal, some other large start-ups in Kalaari’s portfolios include online furniture store Urban Ladder, education technology start-up Simplilearn and online lingerie store Zivame.