Introduction
For startups to grow, capital is required, which decides the initial success of the Startup. It has been observed that startups with significant investments are more prone to success. Funding by one investor is never enough for the complexities faced in the early stages. Venture capitals come into play in such situations.
These firms invest money in small companies with a lot of potentials. Venture capital firms are the messiah that startups need to become a multi-billion-dollar company from a little idea. Today we will cover the most prominent venture firms India. Let us dig into the successes of these firms.
What are venture capital firms?
When a group of investors creates a fund to invest in various businesses that are too risky for a bank to provide any loan, they are called a venture capital firm. As the enterprises are risky, the firm gives loans on the high-interest rate to the business.
The firm sometimes creates a profile of its investments and invests in companies that match the pattern. This way, the venture capital makes an investment a little risky as they know the type of problem faced in that particular market. Venture capital firm invests money in the potential business, and the company pays the loan in various ways.
Sometimes the venture capital firm is given shares in the successful business that has expanded, sometimes the revenue generated by the firm is used to return the loan. Sometimes the business is acquired by some conglomerate, and that money is used to pay back the venture capital firm. This is how venture capital firms work.
Here are some of the features of venture capital firms and the investments they make that you must know:
- It’s a high-risk investment that is made to make high-profits
- The investment made is usually based on long-term financial goals
- The investments are made in startups which have a high-growth potential
- The investment is made by buying equity shares in the startup firm
- Investments are usually made in innovative projects in the fields of technology & biotechnology
Process of Faining Venture Capital Funding
The process of gaining venture capital funding from venture capital firms involves a lot of steps that have been mentioned down below. However, one also needs to keep in mind as to what kind of investments does a firm looks into to venture into the right venture capital firm. For example, a venture capital firm might be more interested in giving early-stage startups a chance while others might be interested more in acquiring startups.
The process of venture capital funding includes:
- The origination of deal
- Screening process
- Evaluation of firm and founders
- Deal negotiation
- Post investment activity
- Exit plan
Top 10 Venture Capital Firms in India:
1. TimesNext Gang
TimesNext Gang holds a special place in our list of top venture capital firms in India. The platform has released its TimesNext Startup Accelerator Program under which it will be giving unique early-stage startups in their ideation and conception phase an opportunity to bag a startup funding of up to Rs 10 lacs.
If you have a plan to bring a disruption in the market and believe that your idea holds a high growth potential if provided with the right resources, TimesNext Gang is the place to be at. TimesNext will be disseminating a total amount of Rs 1 crore amongst a maximum of 25 young and innovative startups, giving them the financial boost to kickstart their journey.
The startup requirements to join the TimesNext Gang are:
- You must be in the initial stages of your startup.
- Your startup idea or concept must be unique, having a high growth potential if given the right monetary resources.
- You have a small yet dedicated team of talented members
Apply to be part of the TimesNext Gang here.
2. Sequoia Capital
Sequoia Capital is an American firm founded in 1972 by Don Valentine. Sequoia also has its operations in India and Israel. In 2005 Sequoia expanded to China and established Sequoia Capital China. In 2006 Westbridge Capital Partners was acquired by Sequoia Capital and later named Sequoia Capital India.
The firm invests mostly in the internet, health, and financial services. Its investments range from $1 million to $ 100 million depending on the stage of development of the business. The firm has successfully invested in Google, Apple, Paypal, Whatsapp, Just Dial, etc. The value of investments of the firm is $500 million to $ 1 billion.
A few of its top-funded startups include:
- DailyHunt
- Bira91
- 1mg
- Awfis
You can visit their website here.
3. Helion Venture Partners
Helion Venture Partners was founded in 2006 by Rahul Chandra, Ashish Gupta, Sanjeev Aggarwal, and Kanwaljit Singh with its office in Bangalore and Gurgaon. The firm focuses on the Indian market and invests in businesses at their seed stage. The company has focused mostly on technology, but it also invests in environmental and education ventures.
The company has created funds of $140 million, $ 210 million, $255 million, and $300 million in 2006, 2008, 2012, and 2015 respectively. In 2012, Economic Times addressed the firm as the largest domestic venture capital firm. The company invests $10 million in a company with a revenue generation of less than $ 10 million in its early stage.
The company has invested money in ventures such as MakeMyTrip, YepMe, PubMatic, Red Bus, etc.
A few of its top-funded startups include:
You can visit their website here.
3. Accel Partners
Accel Partners or Accel is a venture capital firm based in America. It was founded in 1983 by Arthur Patterson and Jim Swartz. The company’s investment philosophy is based on the quote, “Chance Favors Prepared Minds.” The firm invests in information technology, the internet, mobile, media, and other domains. In 2001 Accel expanded its operations in London to enter the European market. In Europe, it invested in BlaBlaCar, Spotify, Supercell, etc.
The firm has raised $2 billion in 2016; it raised $450 million separately for the Indian market after raising $350 million in 2014. The firm has successfully invested in Flipkart, Baby Oye, Myntra, Book My Show, etc.
A few of its top-funded startups include:
You can visit their website here.
4. Nexus Venture Partners
Nexus Venture Capital invests in new businesses in India and the USA. The company provides investment as well as team building and strategic guidance to its entrepreneurs. Nexus invests in business that can grow into standalone companies, new ideas, large firms with potential for growth. The company spends $500k to $10 million in the early stages; the investors prefer seats on the board of the company spent. The firm does not believe in taking over the firm, they become a part of it.
The successful investments of the firm are Delhivery, Snapdeal, Komli, etc.
A few of its top-funded startups include:
You can visit their website here.
5. Intel Capital India
Intel Capital is a part of Intel Corporation; it invests in risky ventures which have the potential to become successful businesses. It was founded in 1991 by Avram Miller and Les Vadasz. It invests in hardware, software, data center, and cloud domains. By 2012 Intel Capital has invested $12.5 billion in 1550 companies in 57 countries. Intel Capital has offices across the world including, Brazil, China, India, Germany, Ireland, etc. In total there are 26 offices in the world.
Intel Capital can invest from $1 million to $100 million depending on the venture. It has invested in companies like Hungama, Snapdeal, etc.
A few of its top-funded startups include:
You can visit their website here.
6. Blume Ventures
Blume Ventures is an Indian based venture capital firm that invests in Digital media, Mobile, and internet services. Blume Ventures was established in 2010 and is located in Mumbai. It can provide funding of 100 crores for 2.5 years. It has successfully invested in Exotel, Printo, etc.
It has won designated 2nd seed investor by Economic times, Number one Active investor by CB Insights, and many more.
A few of its top-funded startups include:
- Unacademy
- Grey Orange
- Dunzo
- Purplle
You can visit their website here.
7. Inventus Capital Partners
Inventus Capital India was founded in 2008 and has contributed largely to the technology domain. The company raised two funds, one in 2008 and the other in 2013. The third fund was raised after restructuring the firm. The firm predominantly invests in Indian and US markets.
It invests in Business to Business and Business to Consumer model firms. It provides funding of $2 million to $10 million. Some successful investments of the firm are Savaari, PoshMark, and Policy Bazaar, etc.
A few of its top-funded startups include:
- Playshifu
- KoinEarth
- RedBus
- Savaari
You can visit their website here.
8. IDG India Ventures
IDG ventures or International Data Group was established in 1996 in California. In the 2000s, IDG spread its operation across India, Vietnam, and Korea. IDG had funds in Europe, although it currently does nor operates there. In 2017, IDG Capital acquired the International Data Group.
The company provides investments of $1 million to $10 million. IDG Ventures is worth $4 billion today. Its successful investments in India are Yatra.com, Myntra, Ozone, etc.
A few of its top-funded startups include:
- Nestaway
- Manthan
- Myntra
- Newgen
You can visit their website here.
9. SAIF Partners
SAIF Partners is a venture capital firm based in Asia. It has offices across Asia, such as Hong Kong, China, and India. It was founded in 2001 as the Softbank Asia Infrastructure Fund. It raised $400 million with Cisco and Softbank being the only partners. The members of Softbank Asia Infrastructure started SAIF capital in 2004.
SAIF has offices in Beijing, Xiamen, Hefei, and many other cities across China. The company invests in Consumer, Education, Finance, Healthcare, Industrials, Internet, IT Services, Logistics, Mobile, SaaS, etc.
In India, SAIF has offices in Bengaluru and Gurugram. It has successfully invested in BookMyShow, Just Dial, Paytm, Home Shop 18, Make my trip, etc. It raised a fund of $350 million for Indian Investments. It invests $5 million to $ 35 million in the early stages of the company.
A few of its top-funded startups include:
- BookMyShow
- ClearTax
- FabAlley
- FirstCry
You can visit their website here.
10. Bessemer Venture Partners
Bessemer Venture Partners, also known as Bessemer, is a venture capital firm founded in 1911 by Henry Phipps. It started as Bessemer Securities; in 1972, it expanded its operations and became Bessemer Venture Partners. In 1985 the Boston office of the company was established. The firm has $5 billion of a fund under its name and invests globally. It expanded to India in 2003.
In 2018 the company entered the machine learning market and started a fund for Applying machine learning to health. In 2018 It raised a fund of $1.85 billion.
Bessemer Venture Partners invests in early and growth stage of companies of the technology domain. The company predominantly invests in consumer, enterprise, and healthcare sectors. It has successfully invested in LinkedIn, Shopify, Skype, Box, DocuSign, Pinterest, etc. In India, it has invested in Snapdeal, Motilal Oswal, etc.
A few of its top-funded startups include:
- Shippo
- HelloRelish
- Previse
- Choco
You can visit their website here.
What is Venture Capital investment?
Venture capital investing is one of the most versatile types of technology-based or creative business VC or funding. It is a broader way to fund investment in business ventures that have a promising future in terms of both income and growth.
Venture capital is spent as investment capital and not as a debt of any kind. Venture capital is also called risk capital due to investment in shares. Venture Capitalist mainly invest in risky projects.
Venture capital is a critical source of risk capital, such as equity financing done by Venture Capitalist. VC has now emerged as the best alternative of funding in both developing and developed countries. Currently, 70 states offer venture capital funding services to business enterprises.
It would be best if you had the following characteristics for VC investment:
- A company that has the potential to grow shortly.
- The investment is expected to take a long time from two to ten years.
- The corporation was meant to have invested in shares of existing business companies that have a long history of earnings.
- The risk level of ongoing projects in the firm, which ensures high profits, should be high.
- The Venture Capitalist must remain involved once the funding has been made.
Growth of Venture Capital in India
In India, the process of venture capitalist has evolved significantly over time. Before, commercial banks and financial institutions only existed, but now India has grown considerably in the number of venture capital investment institutions. Business forms now focus on expansion, as VC can provide financial support. In India, the size and quality of the Venture Capitalist companies have now increased. Several growth-oriented companies have invested in venture capital in international competition. All businesses dealing with the fields of IT, production, and new services can invest in VC in India.
Advantages of Venture Capital
1. Business Expertise
Apart from financial funding, venture capital investment may be an essential source of advice and consulting for start-ups or young companies. VC will assist with a range of strategic decisions, including control of financial resources and human capital.
2. Additional Resources
The VC firm can provide active support, especially at a critical stage in the growth of a young company, in several key fields, including juridical, tax, and personnel issues.
3. Connections
In the business community, venture capitalist are usually well connected. Keeping these connections may have significant advantages.
Disadvantages of Venture Capital
1. Loss of Control
The drawbacks of equity investing, in general, are compounded by the financing of venture capital. It could be spoken of as steroid equity funding. Your VC partners may want to participate with large injectors of cash and qualified investors – and potentially hostile ones.
2. Minority Ownership Status
You could lose management power according to the size of the stake of the VC company in your business, which could be over 50%. You could necessarily give up owning your own company to venture capitalist.
The list of Top 50 Most Active Venture Capitalist:
1. Axilor
Axilor Ventures is an early-stage venture capitalist founded by entrepreneurs and business leaders. In the last few years, Axilor has funded near about 80 startups and made about 30+ investments. Axilor concentrates on early-stage investments across the following sectors – Consumer Internet, Enterprise SaaS, Healthcare Technology, Artificial Intelligence, Fintech, and Industrial IoT.
Founders: Ganapathy Venugopal, S.D. Shibulal, Senapathy Gopalakrishnan, Srinath Batni, Tarun Khanna
Founded Date: 2014
Startups Funded: TimePay, AssetFit, FeedBayk, AgroTribe
Investor Type: Accelerator, Micro VC, Venture Capital
Website: http://axilor.com/
Contact Email: payal@axilor.com
Phone Number: +918049252400
2. Modulor Capital
Modulor Capital is a venture capitalist firm that aims to change the way people invest by providing systematic investing to a different type of investment pockets while joining manager-investor incentives. They offer investment opportunities to both listed (public markets) and unlisted (venture capital), for medium to long term investors. They do this by using data, models, and co-investing structures.
Founders: Bhavish Sood, Sanjit Singh Paul, Neeran Chhiber
Founded Date: 2019
Startups Funded: DesignX
Investor Type: Venture Capital
Website: http://modulorcapital.com/
Phone Number: +919814406500
3. Unicorn India Ventures
Unicorn India Ventures are an early stage technology focused Indian registered venture capitalist firm. They invest in the early stages of technology focussed businesses across industries. They are devoted to supporting these ventures throughout their initial life cycle with follow-on investments in the range between INR 50 lacs and INR 10 crores.
Founders: Anil Joshi, Bhaskar Majumdar
Founded Date: 2015
Startups Funded: VLCC VanityCube, Inc42, Sequretek, Pharmarack, GrabonRent
Investor Type: Micro VC, Venture Capital
Website: https://www.unicornivc.com/
Contact Email: info@unicornivc.com
4. Sequoia Capital
Sequoia helps founders build legendary companies from idea, IPO, and beyond. They encourage founders to push the boundaries of what’s possible. Sequoia Capital is a venture capitalist firm. The Firm invests in energy, financial services, healthcare, internet, mobile, outsourcing, and technology sectors. Sequoia Capital Operations serves clients worldwide.
Founders: Donald T. Valentine
Founded Date: 1972
Startups Funded: Bank Bazaar, Cafe Coffee Day, 1Mg, Grofers, OlaCabs, Zomato
Investor Type: Venture Capital & Private Equity
Website: https://www.sequoiacap.com/india/
Contact Email: sunder.ramdas@sequoiacap.com
Phone Number: 011 4956 7200
5. Indian Angel Network
Indian Angel Network is a chain of Angel investors who are interested in investing in early-stage businesses. They also share a passion for creating value for startup ventures by providing venture capital. The Indian Angel Network offers continuous access to high quality mentoring, vast networks, and inputs on execution.
Founders: Padmaja Ruparel, Saurabh Srivastava, Raman Roy
Founded Date: 2006
Startups funded: Coolberg, LBB, Bixcrum, Uniphore, and StyleDotMe
Investor Type: Venture Capital & Private Equity
Website: http://www.indianangelnetwork.com
Contact Email: kanchi@indianangelnetwork.com
6. Accel Partners
Accel is a leading early and growth-stage venture capitalist firm, powering a global community of entrepreneurs. Accel backs entrepreneurs who have what it takes to build a world-class, category-defining business. Accel’s invest in the companies that will be responsible for the growth of next-generation industries through venture capital.
Founders: Jim Swartz, Arthur Patterson
Founded Date: 1983
Startups Funded: Facebook, Slack, Dropbox, Atlassian, Flipkart, Supercell, Spotify
Investor Type: Venture Capital, Growth Capital
Website: https://www.accel.com/
Contact Email: gururaja.sridhara@gmail.com
Phone Number: +91 80 43539800
7. Y Combinator
Y Combinator is a venture capitalist. It has uncovered a new type of startup funding. Twice a year, they lend a small amount of money in various startups. The Y Combinator partners work jointly with each company to get them into the best possible state and improve their pitch to investors by helping them with venture capital.
Founders: Paul Graham, Jessica Livingston, Trevor Blackwell, Robert Tappan Morris
Founded Date: 2005
Startups Funded: Stripe, Airbnb, Cruise Automation, DoorDash, Coinbase, Instacart, and Dropbox
Investor Type: Accelerator
Website: https://www.ycombinator.com/
Contact Email: info@ycombinator.com
Phone Number: (888) 726-0118
8. Intel Capital
Intel Capital is a venture capitalist firm that is focused on mergers and equity investments related to technology startups. The company aims at investing in a wide variety of companies that offer hardware and software services targeting the enterprise, movement, consumer internet, and digital media. The company focuses on helping businesspeople scale from startups to global companies.
Founders: Avram Miller
Founded Date: 1991
Startups Funded: Mighty AI, Data Robot, Lumiata
Investor Type: Corporate Venture Capital, Venture Capital
Website: https://www.intel.com/content/www/us/en/intel-capital/overview.html
Contact Email: tamiko.hutchinson@intel.com
Phone Number: 408-653-3652
9. Lightspeed Venture Partners
Lightspeed Venture Partners is a venture capitalist firm that is involved in the customer, business, technology markets. It is focused on roots, early stage, later step expansion step, start-up, growth companies, and has specified in debt funding for start-up and growth companies.
Founders: Ravi Mhatre, Christopher Schaepe, Barry Eggers, Peter Nieh
Founded: 2000
Startups Funded: Aqua, Byju, OYO Rooms, Rubrik
Investor Type: Venture Capital
Website: https://lsvp.com/
Contact Email: info@lsvp.com
10. Canaan Partners
Canaan Partners is a venture capitalist firm specializing in investments in all steps of development, seed investments, start-ups, growth, and early-stage ventures, typically Series A and B fundings. It typically invests in technology and healthcare areas.
Founders: Eric Young, Harry T. Rein
Founded Date: 1987
Startups Funded: Skybox Imaging, Match.com, Metacloud
Investor Type: Venture Capital
Website: https://www.canaan.com/
Contact Email: lhahn@canaan.com
11. Helion Venture Partners
Helion Venture an early to mid-stage venture capitalist company. The firm is focused only on India with its offices in Bangalore and Gurgaon.
Helion invests in technology powered companies like ecommerce, online assistance, movement, outsourcing, etc.
Founders: Rahul Chandra, Ashish Gupta, Kanwaljit Singh, and Sanjeev Aggarwal
Founded Date: 2006
Startups Funded: MakeMyTrip, Red Bus, Yepme, Taxi for Sure
Investor Type: Venture Capital
Website: http://www.helionvc.com/
Contact Email: contact@helionvc.com
12. Nexus Venture Capital
Nexus Venture Partners gave India’s Best Venture Capitalist firm by Venture Intelligence APEX. Nexus could invest $500,000 in the roots stage and up to $10 Million in the early maturity stage. Nexus invests in companies like mobile, information security, agribusiness, power, media, and customer sales.
Founders: Naren Gupta, Sandeep Singhal, Suvir Sujan
Founded Date: 2006
Startups Funded: Cloud.com, Craftsvilla, OLX, Zolo, Zomato
Investor Type: Venture Capital
Website: https://nexusvp.com/
Contact Email: jobs@nexusvp.com
13. Blume Ventures
Blume Ventures is a venture capitalist firm that focuses on startups originating from India. Blume invests in Digital communications, mobile, and Internet businesses. What makes the Blume variant is it gives the mentoring to startups and the support needed. It could provide you with funding for up to Rs 100 Crore for 2.5 years.
Founders: Karthik Reddy and Sanjay Nath
Founded Date: 2010
Startups Funded: Exotel, Printo, Carbon Clean Solutions
Investor type: Venture Capital
Website: https://blume.vc/
Contact Email: sanjay@blume.vc
Phone Number: 022 4974 6351
14. Inventus Capital Partners
Inventus Capital is a venture capitalist firm that is funding more than 100 small and big companies worth over $30 billion. Inventus invests in a wide range of companies like mobile, ecommerce, financial, internet, healthcare, etc. In the first round, it gives up to $2 million and in the second round up to $10 Million.
Founders: John Dougery, Kanwal Rekhi, Manu Rekhi, Samir Kumar
Founded Date: 2007
Startups Funded: HealthifyMe, Activity Hero, Motivo
Investor Type: Venture Capital
Website: https://inventuscap.com/
Contact Email: jk@inventuscap.com
15. IDG India Ventures (Now, Chiratae Ventures)
International Data Group Ventures is a venture capitalist and a global company worth $4 billion with a massive existence in India.
IDG invests in mobile phones, internet, and software technologies. It can spend from $1 Million to $10 Million in a company. IDG Ventures is now known as Chiratae Ventures.
Founders: Sudhir Sethi, TC Meenakshisundaram
Founded Date: 2006
Startups Funded: Yatra.com, Myntra, First Cry and Ozone
Investor Type: Corporate Venture Capital
Website: https://www.chiratae.com/
Contact Email: contact@idgvcindia.com
16. SAIF Partners
SAIF Partners is a venture capitalist firm that invests in various startups. SAIF Partnershase backed companies with the worth of over $1 Billion. It started in India in 2001 and invests in sectors like IT, consumer products, and the Internet. It spends $.5 Million in the seed stage and up to $35 Million in the growth stage.
Founders: Andrew Yan
Founded Date: 2001
Startups Funded: Paytm, Just Dial, HomeShop 18 and Book My Show
Investor Type: Private Equity Firm
Website: http://www.sbaif.com/
Contact Email: info@sbaif.com
17. BESSEMER Venture Partners
BESSEMER, a USA based Venture capitalist firm with its office in Bangalore. It invests in tech companies like cybersecurity, mobile, financial, healthcare, etc. It could spend from $100,000 to $50 Million in a given company.
Founders: Henry Phipps
Founded Date: 1911
Startups Funded: Snap Deal, Taxi for Sure and Motilal Oswal
Investor Type: Venture Capital
Website: https://www.bvp.com/india
Contact Email: businessplans@bvp.com
18. DFJ India
Draper Fisher Jurvetson(DFJ) is a venture capital firm founded in 1985, is based in the USA. DFJ has invested in various companies in India. The assets of DFJ are estimated to be around $4 billion. DFJ only provides venture capital in sectors like customer services and investment.
Founders: John Fisher, Mark Bailey, Randy Glein
Founded Date: 1985
Startups Funded: iYogi, Clear Trip, Komli Media, and Bharat Light and Power
Investor Type: Private equity firm
Website: http://dfjgrowth.com/
Contact Email: press@dfj.com
19. Fidelity Growth Partners
Fidelity Growth Partners India is a sister concern of Fidelity International Limited and is a venture capitalist firm. It started investing in Indian companies from the year 2008 and invests in Healthcare, Customer, and production companies. They spend $10 million to $50 million with a share in the company.
Founders: Thomas F. Stephenson
Founded Date: 1969
Startups Funded: Eight roads ventures, Net Magic
Investor Type: Venture Capital
Website: http://www.fidelityventures.com/
20. Norwest Venture Partners
Norwest Venture Partners is a global venture capital firm with an Indian subsidiary situated in Bangalore and Mumbai. It invests in startups like telecommunications, internet, business, etc. Norwest Venture Partners can spend between $15 Million to $75 Million in a company at different platforms. In the early steps, NVP could invest $2 million.
Founders: Promod Haque, Jeff Crowe, Jon Kossow
Founded Date: 1961
Startups Funded: Spotify, Uber, BlueJeans
Investor Type: Venture Capital
Website: https://www.nvp.com/
Contact Email: businessplan@nvp.com
21. Ventureast
Ventureast is an Indian venture capitalist firm. It is an Indian centric Venture Capital firm operating since 2000. Ventureast invests in companies like technology, business, life ability, environment, etc.
Ventureast funds in all three stages seed, early, and growth stage of a business.
Founders: Raghuveer Mendu, Sarath Naru
Founded Date: 1997
Startups Funded: BoonBox, Indus, Kissht
Investor Type: Micro Venture Capitalist
Website: http://www.ventureast.net/
Contact Email: info@ventureast.net
Phone Number: +91-40-6551 0491
22. NASPERS
NASPERS was founded in the year 1915 and incorporated in 1994. It is an international venture capitalist company with a presence in India also that invests in ecommerce, Pay TV, and print media companies in India. NASPERS is an internet group that empowers people and improves areas. NASPERS companies operate and provide venture capital in countries and markets across the world with long-term growth potential.
Founders: J. B. M. Hertzog
Founded date: 1915
Startups Funded: Letgo, Delivery Hero, Swiggy
Investor Type: Private equity firm
Website: https://www.naspers.com/
Contact Email: communications@naspers.com
23. Jungle Ventures
Jungle Ventures is a Singapore based Venture Capitalist Firm that invests in and helps build tech category leaders from Asia. The jungle ventures have a dedicated crew of working companions and working authorities to support startups as they climb across the country.
Founders: Amit Anand, Anurag Srivastava
Founded Date: 2012
Startups Funded: BookMyShow, Catch that bus, Shopspot
Investor Type: Venture capital
Website: https://www.jungle-ventures.com/
Contact Email: info@jungle-ventures.com
24. Steadview Capital
Steadview Capital is a Venture capitalist firm that makes focused, long-term ventures across various enterprises. The firm has a collection of institutional investors, including driving family offices, pensions, endowments, and funds, which attempt to achieve long-term results over regulating short-term volatility.
Founders: Ravi Mehta
Founded Date: 2009
Startups Funded: Nykaa, Flipkart, Ola Cabs, Saavn
Investor type: Private Equity Firm, Venture Capital
Website: https://sites.google.com/view/steadview/
Contact Email: inquiries@steadview.com
25. Kalaari Capital
Kalaari Capital is a venture capitalist firm. They initially invest in technology-based startups, including small companies in their first and seed stage. Kalaari Capital not only provides sufficient fund to startups, but they also have a robust consulting board to assist young businesspeople with practical business resolutions.
Founders: Vani Kola
Founded Date: 2011
Startups Funded: ScoopWhoop, Myntra, UrbanLadder
Investor Type: Venture capital
Website: https://www.kalaari.com/
Contact Email: info@kalaari.com
Phone Number: +91 80 67159600
26. Matrix Partners
Matrix Partners is a US-based venture capitalist company that aims to invest in seed and early-stage startups. The firm has the theory of investing capital in high-growth dormant companies but also helps them in essential areas like hiring, strategic partnerships, etc.
Founders: Paul J. Ferri
Founded Date: 1977
Startups Funded: Canva, Ola, Quora
Investor Type: Venture Capital
Website: https://www.matrixpartners.com/
Contact Email: info@matrixpartners.com
27. 3one4 Capital
3one4 Capital is a venture capitalist firm based in Bangalore, India. The firm works in elite market categories and at the market that is large, growing, and ready for unique products and services. The focus sectors include machine intelligence services for the business, work automation, ambient knowledge technologies, edtech, fintech, media and multi-lingual content generation, consumer data services, and health.
Founders: Pranav Pai
Founded Date: 2016
Startups Funded: YourStory, Faircent, Tripoto
Investor Type: Venture capital
Website: https://3one4capital.com/
Contact Email: hello@3one4capital.com
28. Mayfield Fund
Mayfield is a venture capitalist firm with investing in information technology managers who are producing innovative technology and finding business types. It invests principally in early-stage technology businesses in the enterprise and customer sectors. The firm has invested in about 500 companies and more than 200 mergers or acquisitions.
Founders: Wally Davis, Thomas J. Davis, Jr.
Founded Date: 1969
Startups Funded: India Property, The Beer Cafe, The Lending cart
Investor Type: Venture Capital
Website: https://www.mayfield.com/
Contact Email: info@mayfield.com
29. SoftBank Capital
SoftBank Capital gives venture capital and decisive support to extraordinary entrepreneurs by building disruptive lasting companies. They are a small venture capitalist company of experienced business people and investors who take an “aggressive” approach to help their companies reach their full potential.
Founders: Ron Fisher, Eric Hippeau, Steve Murray, and Michael Perlis
Founded Date: 1995
Startups Funded: Housing.com, InMobi, Alibaba, Snapdeal
Investor Type: Corporate Venture Capital
Website: https://global.softbank/
Contact Email: ContactUs@SoftBank.com
30. Saama Capital
Saama capital is a Bangalore based early-stage venture capitalist firm in India. They support a broad range of business sectors with particular stress on the financial industry.
Founders: Ash Lilani, Suresh Shanmugham
Founded Date: 2012
Startups Funded: AppLabs, Snapdeal
Investor Type: Venture capital
Website: http://www.saamacapital.vc/
Contact Email: contact@saamacapital.vc
31. Zodius Capital
Zodius Capital is operational since the year 2011. The company works intensely on the portfolio of one company at a time to increase and shape up its growth and profit at an exception rate. Zodius Capital is most likely to develop one company every six months.
Founders: Neeraj Bhargava, Gautam Patel
Founded Date: 2011
Startups Funded: BigBasket, Culture Machine
Investor Type: Venture capital
Website: https://www.zodius.com/
Contact Email: info@zodius.com
32. Warburg Pincus
Warburg Pincus is a leading private equity firm in the global market. The primary focus of Warburg Pincus is growth investing. The company has over 37 billion USD as its assets under management. The active portfolio of Warburg Pincus has over 120 companies which are highly diverse in stage, sector and geography.
Founders: Hari Ravichandran
Founded Date: 1996
Startups Funded: lemon Tree, Biba, Quikr
Investor Type: Venture capital
Website: https://www.warburgpincus.com/
Contact Email: investor.services@warburgpincus.com
33. Ascent Capital Advisors
Ascent Capital is an independent private equity firm and has its primary focus in India. Ascent Capital is one of the most experienced teams on the ground with more than 150+ years of experience in the capital market of India.
Founders: Raja Kumar
Founded Date: 2009
Startups Funded: Bigbasket, KIMS
Investor Type: Venture capital
Website: http://www.ascentcapital.in/
Contact Email: info@ascentcapital.in
34. Axon Partners Group
Axon Partners is specialized in global emerging markets. Axon Partners Group prefers to invest in a company focused on technology in countries like Latam, Spain, and India.
Founders: Francisco Velazquez de Cuellar
Founded Date: 2006
Startups Funded: iYogi, ByHours.com, Hot Hotels
Investor Type: Venture capital
Website: https://www.axonpartnersgroup.com/
Contact Email: marketing@axonpartnersgroup.com
35. Bain Capital Private Equity
Bain Capital Private Equity is one of the largest investors in every fundraised. It has an excellent management team that provides the strategic and analytic resources required to build and grow companies.
Founders: Samonnoi Banerjee
Founded Date: 1984
Startups Funded: BPL, ASIMCO, BMC Software, Biglobe, Atento
Investor Type: Venture capital
Website: https://www.baincapitalprivateequity.com/
Contact Email: privateequity@baincapital.com.
36. Basil Partners
Basil Partners is a venture capital fund that is involved in early-stage venture investments. It focuses on investing in North America, Europe, Asian countries, including India.
Founders: Ramanan Raghavebdran and Rajeev Srivastava
Founded Date: 2008
Startups Funded: Endeavour Software Technologies, Karmic Lifesciences
Investor Type: Venture capital
Website: www.basilpartners.com
Contact Email: info@basilpartners.com
37. Battery Ventures
Battery Ventures is from Boston, Silicon Valley. Battery Venture mainly invests in technology-driven companies. The firm has deep pockets with its over 30 years of experience.
Founders: Neeraj Agrawal
Founded Date: 1983
Startups Funded: HackerRank, AppDynamics
Investor Type: Venture capital
Website: https://www.battery.com
38. Catamaran Investment Pvt Ltd
Catamaran Investment is a private investment company. The company has its HQ in Banglore, India as well as in London, UK.
Founders: N R Narayana Murthy
Founded Date: 2010
Startups Funded: Yebhi
Investor Type: Venture capital
Website: https://catamaran.in/
Contact Email: info@catamaran.in
39. Forum Synergies (India) PE Fund
Forum Synergies is heading in the direction to become India’s most unique and ethical private equity fund management model. Forum Synergies aims to provide best-in-class individual equity models to its investors.
Founders: Samir Inamdar
Founded Date: 2007
Startups Funded: Zomato, Ola, Quikr, Freechsrge, TaxiForSure, Housing, Commonfloor
Investor Type: Venture capital
Website: http://forumsynergies.com
Contact Email: prashant@forumsynergies.com
40. Fulcrum Venture India
Fulcrum Venture India is a private equity investor and focuses primarily on SME business opportunities. It prefers to invest in entrepreneurs who are like-minded and has solid principles and objectives.
Founders: Krishna Ramanathan, Ethan Khatri, Mahesh Shankaranarayan
Founded Date: 2000
Startups Funded: Shield Healthcare Pvt Ltd, SwaaS Systems, Congruent Solutions
Investor Type: Venture capital
Website: https://fulcrumventureindia.com/
Contact Email: fulcrum@fulcrumventureindia.com
41. General Atlantic LLC
General Atlantic is one of the most leading growth equity firms in the global market. General Atlantic provides capital and strategic support to growing companies, including early-stage venture, later-stage venture and private equity investments.
Founders: Sandeep Naik
Founded Date: 1980
Startups Funded: Vox Media, Klara, Squarespace, Citiustech
Investor Type: Venture capital
Website: https://www.generalatlantic.com/
Contact Email: inquiries@generalatlantic.com
42. India Quotient
India Quotient is an early-stage funding firm.
Founders: Madhukar Sinha, Anand Lunia
Founded Date: 2012
Startups Funded: Grabhouse, Rpoposo, DogSpot, FRSH, Prettysecrets
Investor Type: Venture capital
Website: https://www.indiaquotient.in/
43. IvyCap Venture
An entrepreneur centric investment approach guides Ivy Cap Ventures. It focuses on high-quality professional entrepreneurs via the country’s premier educational institutes.
Founders: Norbert Fernandes
Founded Date: 2011
Startups Funded: eShakti.com, FieldEZ, Aujas Network, Leixir
Investor Type: Venture capital
Website: http://www.ivycapventures.com/
Contact Email: corporate@ivycapventures.com
44. Kae Capital
Kae Capital invests in companies that have innovative solutions to reduce the gaps in the market. They aim to identify and build large companies, even from a mere concept.
Founders: Navin Honagudi, Shashank Hirawat, Sasha Mirchandani, Nisha Mohamedi
Founded Date: 2010
Startups Funded: Airwoot, Shopsense, SysCloud, FortunePlay, ShepsHerts, Nuiku
Investor Type: Venture capital
Website: www.kae-capital.com
45. Lightbox Management Ltd
Lightbox Management Ltd is an India based venture capital that focuses on the early-stage consumer technology business.
Founders: Sandeep Murthy, Siddharth Talwar
Founded Date: 2014
Startups Funded: Cleartrip, Embibe, GreenDust
Investor Type: Venture capital
Website: www.kae-capital.com
Contact Email: hello@lightbox.vc
46. Lok Capital Group
Lok Capital Group is Gurgoan based venture capital.
Founders: Rajiv Lall
Founded Date: 2000
Startups Funded: Hippocampus Learning Centres, Everest Edusys and Solutions
Investor Type: Venture capital
Website: http://www.lokcapital.com/
Contact Email: contact@lokcapital.com
47. New Enterprise Associates
New Enterprises Associates is one of the largest and most active venture capital that helps entrepreneurs to build a transformational business in multiple stages, sectors, and geographies.
Founders: Krishna Kittu Kolluri, Tarun Sharma
Founded Date: 1997
Startups Funded: IndiaHomes, Blueshift Labs, Forter, Inksedge
Investor Type: Venture capital
Website: https://www.nea.com/
48. New Path Ventures, LLC
New Path Ventures is a venture capital firm which has a specialization in seed-stage startups as well as in early-stage investments, and they prefer to invest in technology-based startups.
Founders: Vinod K., Tushar Dave, Mahesh Karanth
Founded Date: 2002
Startups Funded: Telsima, inSilica, Montalvo Systems
Investor Type: Venture capital
Website: http://www.newpathventures.com/
49. Nirvana Venture Advisors
Nirvana Venture Advisors specializes in investing early-stage and market-leading companies of India.
Founders: Amit Patni
Founded Date: 2011
Startups Funded: Reviews42, KartRocket, Transerv
Investor Type: Venture capital
Website: http://www.nirvanaventures.in
Contact Email: info@nirvanaventures.in
50. Ojas Venture Partners
Ojas Venture Partners is an Indian venture capital that aims to make young startups of India to become successful.
Founders: Dr Rajesh Srivathsa
Founded Date: 2007
Startups Funded: CBazaar, Tyfone, Vizury, RiverSilica, Mango Techno
Investor Type: Venture capital
Website: www.ojasventures.com
Contact Email: pingus@ojasventures.com
Frequently Asked Questions – Venture Capital Firms in India
1. How many venture capital firms are there in India?
More than 150 venture capital firms in India have been investing in new startups from across the country. While some of these are based in India, mainly comprising of the association of the uber-rich, others are the venture capital firms that have their branches in India to seek out investments on a larger scale.
2. What is Venture Capital India?
Venture capital fund in India is a type of investment funding that manages the money from different investors with the sole aim to provide capital to small to medium-sized enterprises and startups that hold strong growth potential.
3. What are the types of venture capital provided by venture capital firms in India?
Venture capital firms in India may or may not specialize in providing just one of these series of funding for a startup or a business. Types of venture capital provided by venture capital firms in India are:
- Seed Capital: Seed capital is the funding provided to startups having no product or organized company yet.
- Startup Capital: Startup capital is the funding provided to startups having a prototype and are available with one principal working full-time.
- Early Stage Capital: Startups in the first 2 to 3 years of their business looking for funds to reach their break-even point & increase company efficiency can seek out this investment.
- Expansion Capital: Expansion capital helps well-established companies achieve their next level of growth goals.
- Late Stage Capital: Late-stage capital helps companies who have already achieved impressive sales and revenue to increase their working capital to ramp up marketing and increase capacity.
4. What is venture capital?
Venture capital is a source of investing in early-stage businesses with a high potential for success. The kinds of venture capital in India firms invest in appearing to be young and mostly pre-profit, and perhaps also pre-revenue. Venture capital India acquire minority ownership interests in these businesses and provide them with strategic resources and industry experience to help them expand and prosper.
5. Who are venture capitalists?
A venture capitalist is an individual or company that gives management support and investment resources to emerging companies to get things started smoothly. As insurance, the person or organization supplying the funds shall be interested in the new business and its profits. Usually, the value of this equity stake is calculated to be equal to the amount committed and the risk associated.
6. Why does my company need Venture capital investment?
Venture capital India -backed businesses are at the outset of the development process of their existence and thus have an immense growth opportunity. Sometimes, with little to no track record, these startups depend on “venture capital”: India funding to reach this potential. Companies also utilize venture capital funds to produce and sell goods, set up their production and distribution facilities, and grow their company by hiring new employees.
Venture capital in India offers not only much-needed funding, but also a range of industry knowledge, talents, and connections to help the company expand and prosper.
7. Questions to ask Venture capitalists?
- Is the business eligible for VC funding?
- Which are the tradeoffs for embracing VC funds over other debt and equity options?
- Which venture capital in India is working in your field, so who might be an energetic match based on their investments, so their usual investment profile?
8. What venture capitalist for in a startup?
Venture capitalist are searching for a strategic advantage on the market. They expect their equity firms to be able to produce sales and profits before rivals reach the business, and to minimize productivity—the less direct competitors in the space, the better.
9. Things not to do while pitching to the venture capitalist
- Don’t forget the company.
- Don’t start with the risks involved.
- Don’t raise funds on the runway.
- Don’t ask for money that doesn’t match your stage of business.
- Don’t miss the organizational steps.
- Don’t waste your time talking to the wrong investors; don’t spend money.
- Don’t waste your early impressions.
10. Does the venture capitalist make a lot of money?
A good venture capitalist with a top-tier company will expect to receive between $10 million and $20 million a year. The best even make more. Meanwhile, there is also a 2 percent or 2.5 percent management fee charged by venture capital India to their investors.
11. In what ways does a venture capitalist benefits the business?
A venture capitalist introduces much-required investment without any daily redemption into the organization from a solely financial point of view. The individual should not be treated as a lender because he or she expresses his or her expectations for the business’s success. This ensures that the organization has exposure to its network, expertise, and discipline. A venture capitalist interest in the company offers you more exposure to the broader market.
12. What is venture capitalist investing?
“Venture capital”: India fund creditors are usually big entities, including mutual funds, banking firms, insurance agencies, and university grants. Many of them participate in high-risk, investing a limited portion of their overall assets.
13. What is the difference between a Venture capitalist and angel investors?
Angel investors are wealthy people (or groups of rich persons) who spend their capital in companies. Venture capitalists ( VCs) are employees of venture capital companies who invest the money of other individuals in companies (which they keep in a fund).
14. What return does Venture capitalist expect in return?
A new company may receive returns of up to 700% or see a negative return. The average yield is 25 percent, as reported by the National Economic Research Bureau. At least the average return for a venture capital India fund would be able to, but, depending on the market success, have higher goals.
15. Is Venture capital a good idea?
Sometimes, cash is the most significant hurdle between a promising concept and a successful business. Venture capital may be a potential source of investment for a startup or a company. Venture Capital in India firms spends calculatedly in businesses that they think are worthy of generating profits.
16. How are venture capital firms structured?
Typically, venture capital is split between the managing firm (franchise) and the funds it receives (or LP entities). The funds have their schedules, investment targets, and management philosophies distinguished from other funds owned under the same umbrella management company.
E.g., Sequoia Capital is a prestigious venture capital firm (management company) headquartered in the Bay Area. Their investments have resulted in 68 IPOs and 203 acquisitions. At the investment point, Sequoia’s Venture XI Investment was started in 2003 and raised $387 million. Sequoia’s India IV fund launched in 2014 and raised around $700 million.
17. What roles exist within a venture capital firm?
The individual structures that vary from firm to firm, but the necessary arrangement of functions is relatively bright in venture capital.
- General partners (GP’s) manage the company while still contributing a small amount with creditors. (LP’s want creditors to have some “skin in the game” alongside them.)
- Capital investors engage in business procurement (finding firms to invest in and promoting investments) and managing individual assets in venture capital firms.
- Principals work with partners to find opportunities and handle assets.
- Associates work under principals who participate in all of the planning, research whose preparation goes into contract procurement and fund management.
18. How do venture capital firms raise money?
Venture capital firms collect capital from various sources, including major firms, insurers, qualified (institutional investors), other investment funds, foundations, government / corporate pension funds, high net-worth individuals, endowments, and insurance providers. The more reputation a venture capitalist has, the harder it would be for the capitalist to collect venture capital.
19. How do venture capital firms get paid?
The majority of VC hauls derive from something called “carry.” Carry is the benefit that VC’s earn after returning venture capital to its investors. The fund’s profits are distributed to the Limited Partners (LP) and General Partners (GP). The LP’s are the founders, and the GP is the investment committee of the fund.
The carry is usually split 80 percent LP and 20 percent GP. It is necessary to note that the gains are paid out only after the original capital venture returns. GP’s are customarily issued payouts according to a vesting term, generally four years.
20. How are CVC’s different from typical VC’s?
In other cases, venture capital firms are not different. The crucial distinctions lie in incentive for investment. At the same time, “normal” VC’s are driven mainly by return. CVC can also seek insight into a portfolio company’s innovations, go to market approach or strategic effect upon the CVC’s core industry.
21. Why should an entrepreneur take on venture capital investment?
- The entrepreneur does not want to/is not ready to take on a loan from a bank.
- The entrepreneur wants to grow his / her venture to be very large, very fast using venture capital.
- The entrepreneur is interested in exiting (via a sale, IPO) within ten years.
- The entrepreneur wants to give people with knowledge/resources a stake in his/her company.
22. Why should an entrepreneur not take on venture capital investment?
- The entrepreneur wants to maintain total control of his / her company, which can be done through venture capital.
- The entrepreneur is not comfortable with the idea of his/her equity being diluted.
- The entrepreneur is not interested in exiting (via selling, IPO) within ten years.
- The entrepreneur is already very cash flow positive and does not require an additional capital infusion to grow at the rate he or she desires.
23. What do entrepreneurs need to prepare to interact with potential investors?
Entrepreneurs will have to prepare the following:
- Executive Overview (1–2-page explanation of the product, staff, and business) for venture capital.
- Short description of the company (a few paragraphs that you can use to describe your business in an email)
- Slide presentation (10 to 20 slides offering a detailed summary of your business)
- Business strategy (a text outlining the procedure for bringing the company to life) can be achieved in several ways but contact Google first)
- Financial forecasts (focus on both sales and cost)
- Due diligence documents (any documentation relevant to legal, due diligence such as contracts, partnership agreements, board meeting notes, etc.)
24. What is valuation? Why does it matter in venture capital?
The valuation shall be the accounting at the period of investment allocated to a company. In venture capital, assessment is critical since a low cost allows the investment firm to spend more money to have the same equity percentage.
25. What percentage do Venture Capital firms take?
Venture capital funds usually demand that they own at least 20% of all early-stage fund companies. Co-investor VC demand 20 to 25%. Many VCs tend to participate along with a co-investor. This usually thought to be more advantageous for both shareholders and the business (aside from the dilution) in venture capital.
26. What are the features of Venture capital?
- Involves high risk
- The shortage of liquidity.
- Long-term view.
- Equity shareholding and capital gains.
- Investments in venture capital are made in innovative ideas.
- Venture capital suppliers take part in the company’s management.
27. When should you look for Venture Capital?
You could consider a venture capital firm ready to fund you if your new business can make it big! You would like to consider pursuing funding from a venture capital fund if specific considerations are present in the existing business strategy and business model.
28. How do I connect to Venture capital firms?
- Check your network, and if you don’t meet any investors personally, figure out who you know, then stay in touch with them.
- Connect with startup lawyers or auditors. Typically they have the correct relations
- Arrange a press conference and investors could even start to look for you
- Write an Ebook about venture capital (or other similar topics) and reach out and VCs to see whether they would like to help. Build this relationship.
- Have a peek at a nearby social hangout place (business party, bar, country club, etc.) and a non-sales network around for looking for venture capital.
- Build a board and exploit the interface for searching venture capital.
- If you’re going to be able to reach out without an intro, get innovative. Find out the favorite sports team of the VCs and give them a copy of the deck. Alternatively, look at their favorite book and submit a copy of our pack, showing them you’ve gone out of the way to do some work to personalize the experience of venture capital.
29. Do I need to return venture capital?
Working for venture capitalists is not about taking out a loan. The owners of companies have no duty to repay the venture capital; however, it is in their best interest. Venture capitalists are well-connected on a variety of market lines for venture capital.
30. Is Venture capital short or long-term?
Venture capital provides dedicated, long-term equity capital to improve and thrive unquoted businesses. Lenders have the moral right of interest on the debt and the redemption of the money. This is regardless of the performance or loss of the undertaking. In return for an equity interest in the company, venture capital is invested.
31. Why is Venture capital better than a Bank Loan?
The response is rather minimal. However, the distinction between Venture Capital (VC) and bank loans should be known. VC is a high risk with a higher reward. Investors take a stake in a company to benefit from the equity of “winners” to compensate for the losses.
32. What are the sources of Venture Capital?
Venture capital is a kind of private equity and a source of financing offered by investors to startups and small businesses that have the potential for long-term development. Venture Capital is typically received from well-off investors, investment firms, etc.
33. Do I need Venture Capital?
Venture capital will provide the business with the funding required for the next growth phase. Investment in equities is also the chosen path to expand without bank loans’ debt burden. Be sure that you locate money ideally tailored to your expansion process and have the business experience to succeed efficiently.
34. Who uses Venture capital?
Venture capital is investing investments in businesses and small companies that are typically high risk but still have an explosive development opportunity. The target of a venture capital investment is a substantial return on the company, usually in the form of a startup merger or an IPO.
35. What are the four types of capital?
- Debt
- Equity
- Trading
- Working capital
36. What are the pros of Venture capital?
- Possibility of business growth using venture capital.
- Valuable expert knowledge and advice.
- Helpful in networking and teamwork.
- No reimbursement obligation in venture capital.
- VC’s are optimistic.
- Simple to find.
- Ownership and monitoring dilution.
- Early VC’s redemption
37. What if I don’t know about any venture capital firms?
This is what risk financing outside of certain circles is all about. Although this certainly complicates matters, it’s better than it ever was thanks to the beauty of the internet that meets investors; LinkedIn, Twitter, and so on and be both ideal tools to satisfy investors.
Networking is a subject worthy of its writings, but I will say this. Make things you can point to (executive demo, product reviews, marketing campaign, figures on sales, etc.) so that you don’t have to work to prepare an investor at the time.
38. Why would a company want to go for venture capital?
You typically try equity investment because you require further money but don’t want (or can’t) take on more debt. The remedy can be risk venture capital or funding by a business angel for smaller businesses.
Venture capital in India may be an alternative in the following cases:
- A profitable company that needs cash to expand, such as growing its capacity to cope with current demand, or creating new goods or markets
- Part of the current management team trying to replace new shareholders or an external management party pursuing the same (Management buy-in or ‘MBI’)
39. What hinders a company from going for Venture capitalist in India?
- To make negotiated payments for debt, royalties, and dividends, you must produce the cash needed. This will cause tremendous financial pressure on venture capital in India.
- As part of the deal, you must agree to certain restrictions, such as the amount you pay and your participation in other companies. Typically you would need the approval of your investor for decision making.
- If your investor is unable to attain financial goals, he or she could insist on having a delegate on your board. This is usually a non-managing director for “venture capital“: India, who only participates actively if things go wrong. Often a business angel needs to be on the board and take more active roles.
40. What is the amount of venture capital firms in India that would invest in my business?
The time and energy are taken to sized a business that seeks $50,000 can be almost as high as one that seeks $1 million. Many venture capitalist in India cannot look at any company that needs less than $500,000. A business angel is also ready to invest less in the company.
41. How to choose between angel investors and venture capital firms?
Both invest in new and developing businesses through equity capital. However, in general, a venture capitalist in India is an investment firm- an insurance company, a mutual fund, for example, or another fund management entity. Because they spend money on behalf of other people, they may have strict expectations — the type of company they are willing to invest in, the return rate they expect, etc.
Business angels are private individuals who want to spend a lump sum for themselves in a corporation for which they are willing to make a non-monetary donation. They may have fewer financial resources than venture capital”: India but possibly have a smarter strategy.
42. Do venture capital firms in India only invest in shares or debt too?
Many venture capitalist in India are willing to talk about generating equity and debt capital, but it is doubtful that they will find a bond deal alone. This is the intention of the banks. Nonetheless, if you plan to offer a debt and equity bundle, it would be best for your own company to arrange it: after all, you ‘buy’ the money, so you don’t want to tie yourself to any supplier too tightly.
43. How to get to know that venture capital firms are interested in what stake?
This must be negotiated. Few “venture capital”: India would require more than 30 percent in broad terms. Many are limited to holding not more than 10-20% of the shares in a business using the conditions they are allowed to invest. The question then arises if 10-20 percent of the money you want to provide in your business is worth the money.
If the prospects of growth are sufficiently good, a business angel venture capital in India will become more involved. But before you give them a stake of more than 30%, you must be very confident you will work with them.
44. What rights does venture capitalist in India get with shares?
- Holders who vote at 5 percent are entitled if they fail to do so within a reasonable period, call an executive committee (the shareholders’ meeting), or call them at the corporation’s expense.
- Special resolutions can be blocked by holders of at least 25 percent of common shares. A special resolution must amend the business Articles of Association exclusively for the venture capital firms.
- When accepting accounts, minority shareholders can not obstruct majority approval, decide on the directors’ remuneration, or appoint new directors. Nevertheless, the shareholder’s agreement can contain limitations for venture capital firms in India.
45. What will venture capital firms ask for in the management approximately?
As a rule, you would presume that venture capital in India will want to know what’s happening. They usually don’t want to be involved every day because they have plenty of details. Yet business angels venture capitalist in India is still able to engage in everyday management. That is another explanation why it would pay you, instead of merely trying to go to an agent that knows what the funding partners want.
46. Do venture capital firms need a seat on the board?
Most venture capital firms in India believe that your company strategy is your business and will only judge you by the final results. Some people would rather say what they think to at least recommend a change of mind if they see you doing anything that they say has proven catastrophic elsewhere. Most people would like to have the right to name ‘their’ board director when things go well.
The bulk of the business angels will want a seat on the board and will prove to be senior and sensitive towards “venture capital”: India.
47. For how long would a venture capitalist in India want to invest?
Venture capital firms are expected to sell their shares in just three years. In comparison, the business angels are supposed to think for a more extended period in the first instance, say five years. When things go wrong, you will seek rescue faster. When things go well, you will probably be able to spend a little longer with venture capital.
The key escape routes of venture capital in India are as follows:
- Selling to another business
- Another company refinancing its investment
- A listing of shares on an exchange which permits them to be publicly offered, such as AIM (Alternative Investment Market), or the stock exchange Main Market
- Repurchase by management or the business of the investor’s shares
48. What can I do if I have a dispute with the venture capital firms?
A venture capitalist in India and business angels know that they will have problems with some of their investments. It leaves them in the dark what they don’t want. Tell them what’s going on and what you are planning to do with the venture capital.
If you are not happy with your explaining and proposing, minority shareholders will not be able to do very much-except to dump their shares at the best price and pass the message. Yet if your foreign investors retain debt, they can (according to the terms), be able to compel you to repay it. (They can ruin their efforts to collect new venture capital for years to come, so don’t take that lightly).
49. Can I ask the same venture capital firms in India to reinvest?
It depends. If in the short term, you need more money (that is in two years) because you miscalculated the amount you needed, or because the returns come more slowly than you had expected, or something else went wrong, the answer is probably no.
All venture capital firms and corporate angels are complicated to handle, and you are unlikely to persuade them to cash good money after evil. However, the answer could be yes if you want “venture capital”: India in the medium term to expand the production or move into new markets.
50. What do my venture capital firms in India require for being assured about my business?
You need to make a business strategy, and you need to take advice. You would at least have to supply the following documents to the venture capital firms:
- Explanatory knowledge on who you are (including your age, qualifications, history, etc.)
- Explaining your business and where you intend to take your business
- As far back as you can go, sales and profits
- Balance of assets and liabilities
- A 3-year comprehensive profit and revenue forecast
- Detailed estimated cash flow for the same span of three years
- An insight into what you expect to do in the next two years
- Your management team info (if relevant)
51. How experienced must my management team be for “venture capital”: India?
When you think of raising money from venture capital firms, you will have a good track record. Some business angels and venture capitalist in India may be more likely to help unproven talent. If it is not already profitable, the company will have a good chance shortly to produce sustainable and stable cash flow and income.
An experienced, healthy, and competent management team, is ideally required for venture capital firms in India, who is:
- Put your own money in the company
- A large part of their earnings are prepared to be related to achievement
- Contractually bounden-for example, if vital creative people should quit a publicity agency, it is challenging to protect venture capital.
