Ventureast Funds to raise $150 million by March

Ventureast Funds to raise $150 million by March

Mumbai: Hyderabad-based venture capital investor Ventureast Funds, the former joint venture with Andhra Pradesh Industrial Development Corp. Ltd (APIDC), plans to raise new funds worth $150 million (around Rs590 crore) by March.

The firm, which currently manages $150 million, “plans to double the capital under management", said Sarath Naru, managing director, Ventureast. Among the funds planned, two will focus exclusively on life sciences and information technology (IT), respectively.

The life sciences fund will be branded under the APIDC umbrella and the IT-focused fund under the Ventureast brand. The firm, formally registered as APIDC Venture Capital Ltd, manages funds under both brands.

While it is still working on the details, the IT fund will be managed out of its Chennai office, while the life sciences fund will operate from Hyderabad. The new funds will have repeat investors, Naru said. Current investors include domestic investors such as Andhra Bank, Indian Overseas Bank and Life Insurance Corp., and overseas investors such as IFC Washington, Saudi Economic and Development Co. (Saudi Arabia) and Norfund (Norway).

Ventureast, an outfit that Naru founded, set up its first fund in the country in 1997 as a joint venture with APIDC, when the state government outfit decided to partially privatize its venture capital operations. At the time, APIDC owned a 49% stake in APIDC Venture.

In subsequent funds raised, APIDC has gradually brought down its stake and now holds only 1%, making it more a limited partner (insititutions which invest in venture capital funds). Funds raised by APIDC Venture so far include a $40 million biotechnology fund and a $92 million life sciences fund.

In addition, Ventureast itself has launched two independent funds, managed by Ventureast Fund Advisors India Ltd, as incubation capital on the Indian Institute of Technology (IIT), Madras campus—Ventureast TeNet I with a $15 million corpus and Ventureast TeNet II with an $18 million corpus. Internet giant Google Inc. acquired a 30% stake in Ventureast TeNet II in July this year.