Bangalore-based NEA IndoUS Ventures (NIUV) has completed the second round of fund raising for its India fund, mobilizing $189 million (Rs756 crore), the most by a venture capital fund in the latest round of fund-raising (several other funds have also raised India funds recently) for early stage investments in India and India-centric companies. The fund had raised $105 million in the first round in 2006.
The fund will be deployed in early- to mid-stage companies in the technology space, said Kumar Shiralagi, managing director, NIUV. “Be it telecom, IT or IT services, we will invest across the domain—either in pure-play technology companies or in tech-enabled services companies,” he added. The fund has already invested $10 million in Mumbai-based telecom company Microqual this week along with JAFCO Asia and BTS Private Equity Fund. Microqual provides telecom components and chips to Indian telecom companies.
This is NIUV’s third investment in the past one month. The company has invested $5 million in online travel company ViaJustGo (formerly Flight Raja) and co-invested in a $25 million deal led by parent fund NEA in mortgage solutions company ISGN Technologies.
NIUV plans to focus on technology. Its three partners—Vinod Dham, Vani Kola and Kumar Shiralagi—have worked on the R&D and operations side of technology companies before turning to venture capital. Shiralagi was also country director of Bangalore-based Intel Capital, the venture capital arm of Intel Corp. “Unlike most venture funds who come from a financial background, we have a strong technology background, so we can help start-ups in accessing tech companies with whom we’ve had a past relationship,” said Shiralagi.
Their experience comes in handy, especially with very early-stage start-ups, he added. “From starting the business to the technology expertise, they need all the skills,” said Shiralagi. The company is also looking at incubating companies in the mobile phones space. “If we find the team competent to implement the technology, we will back it,” he added. While it invests primarily in the India market, the company is also looking at US-based firms which have a significant India presence.
The current round of fundraising by funds looking at early-stage investments in companies has seen an average corpus of around $150 million. Apart from NIUV, other venture capital firms that have raised India-specific funds include Mumbai-based Matrix Partners India ($150 million), Bangalore-based IDG Ventures India ($150 million) and Helion Ventures ($140 million). Sequoia Capital, once among the largest venture capital funds in India, has been gradually moving into growth-stage companies since mid-2006.
Sequoia had previously raised $150 million for early-stage companies. Other venture capital firms such as Canaan Partners India, Mayfield Fund and Kleiner Perkins Caulfield and Byers invest extensively in early-stage Indian companies, but do not have a specific India corpus.