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September 27, 2016

With half-a-dozen exits, Sequoia Capital spins a new startup tale: The Economic Times

An Economic Times article quotes Venture Intelligence data in an article on exits by Sequoia Capital in 2016:
Software maker Quick Heal and small finance bank licence holder Equitas Holdings, which listed earlier this year, are estimated to have delivered returns of 3.5 times and 2.25 times respectively to the venture capital fund (Sequoia Capital) according to research firm Venture Intelligence.
Venture capital investment for the period January to September 2016, dropped to 285 deals, totaling $1.03 billion, compared to 390 deals, with a cumulative value of $1.6 billion, in the year ago period, according to Venture Intelligence. Exits were valued at $1 Billion, spread across 48 deals, compared to 41 transactions, estimated at about $1.4 billion in the year ago period
Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


September 25, 2016

Mint-Venture Intelligence Deal Tracker (Sept 19)

Venture Intelligence is powering the (Weekly) Deal Tracker on The Mint. The Weekly update is featured in the Deals Section on every Monday.




Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

September 23, 2016

VC Investors with Most #Unicorns in Portfolio

A Mint article showcases Venture Intelligence data on Venture Capital firms with most Unicorn companies in their portfolio. #1 Tiger Global (5), #2 Sequoia Capital India (3)




Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

ET Now Startup Central - Venture Intelligence Funding Meter (Week of Sept 19)

Catch the week's VC Stats along with a study on venture exits in 2016 in this week's edition of the Funding Meter powered by Venture Intelligence.




Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

Edelweiss Group to acquire Ambit Alpha Fund: Mint

A Mint article titled Edelweiss Group to acquire Ambit Alpha Fund quotes Venture Intelligence data on M&A deals in the asset management space:



Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.



September 22, 2016

(Masayoshi) Son is still looking for the next big thing in India: Nikkei

A Nikkei article quotes Venture Intelligence Arun Natarajan on SoftBank's journey in India:
"SoftBank is one of the very few startup investors willing and able to lay down hundreds of millions of dollars in a single go" said Arun Natarajan, CEO of research company Venture Intelligence.
SoftBank's former second-in-command, Nikesh Arora, helped lead the company's Indian strategy after coming aboard in 2014 and continued to do so until his departure in June of this year. But he was not the reason SoftBank came to India, according to Natarajan. "They were in India and continue to be around regardless of Nikesh Arora," he said.
Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.



September 21, 2016

PEs go for the cream: mydigitalfc

A mydigitalfc article quotes Venture Intelligence data on PE/VC Exits
Since 2014, there have been about 30 exits. The ongoing year has so far seen the highest exits — worth $686 million — in 12 companies, while there were 15 exits worth $287 million in 2015; there were four exits worth $109 million in 2014, according to data sourced from Venture Intelligence.
Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

Multiples PE to venture into special situation investing: Mint

A Mint article titled Multiples PE to venture into special situation investing quotes Venture Intelligence data on Investors and investments in the Distressed Assets field. (According to the article the gross bad loans of 39 listed Indian banks, in absolute terms, rose 92% in fiscal 2016 to Rs 5.79 trillion.)


Other global private equity funds such as KKR and Co., Hong Kong-based SSG Capital Management and International Finance Corp. (IFC), the investment arm of the World Bank, have already acquired stakes in existing ARCs to buy bad loans. In January 2015, IFC invested in Encore Asset Reconstruction Co. Pvt. Ltd and in March this year, the Foreign Investment Promotion Board gave approval to KKR & Co. for picking up a stake in International Asset Reconstruction Co. Pvt. Ltd.


Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

September 20, 2016

IDFC Alternatives to create a platform for renewable energy assets: Mint

A Mint article titled IDFC Alternatives to create a platform for renewable energy assets quotes Venture Intelligence data on investments in the Renewable Energy space:


In the last two years, the renewable energy space, especially solar and wind power, has seen a lot of private capital flowing in. Recently, Greenko, which is a developer of wind and small hydro power projects, secured $230 million from sovereign wealth funds of Abu Dhabi and Singapore.
Last year, emerging markets-focused private equity major Actis Llp also created a renewable energy platform under Ostro Energy with initial commitment of $230 million.


Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

September 19, 2016

Startup Success & Failure: Does the City Play a Role?

As reports of Startup Shutdowns & "Acqui-Hires" began to flood the media in 2016, Venture Intelligence did quick study of companies that had raised angel investments in the 2010-2014 period across Bangalore, Chennai, Mumbai and National Capital Region to check if there is a city flavour to these companies. On the flip side, there were obviously also companies that managed to raise successful follow-on financing or even deliver quick exits to their investors.


Mumbai based companies had the highest "success" rate - 40% - in terms of raising a follow-on round / providing an exit. Mumbai startups showed a healthy mix of sectors being funded - be it B2C, B2B, Enterprise Software, Fintech, etc. Mumbai companies which raised follow-on funding include Ola (taxi aggregator), Goqii (wearables), Mswipe (payments) and PrettySecrets (Innerwear). Companies which shut down include Purple Squirrel, Fetise (Apparels) and LocalBanya (Hyperlocal). Being from the financial capital of the country, Mumbai startups are clearly favored by the access to a large pool of local investors - VC, Strategic and Family Offices.

Chennai based startups recorded negligible shut down rates - a phenomenon that seems attributable to the predominantly B2B flavour of their businesses (the city being India's de facto SaaS Capital) and the relatively later stage at which entrepreneurs here choose to seek external capital. (Stayzilla and Ticketgoose for instance raised their angel rounds after seven years of incorporation, while companies like Freshdesk chose to skip the angel round completely). On the flip side, its relatively low success rate seems attributable to the low access to local capital. Chennai-based companies which raised follow on funding during the period studied include Stayzilla (hotel aggregator), Uniphore Software Systems (speech analytics), Ather Energy (e-vehicles), etc. (Both Stayzilla and Ather moved their headquarters to Bangalore after raising venture capital.)

NCR & Bangalore based companies registered the highest shut down rates - >6%. Most of their casualties were in the food tech (like Spoonjoy, Dazo etc.) and hyperlocal space - which the two cities supplied to investors in plentiful numbers during the hyper-active funding environment in 2014-15. Naturally, these cities (with their large volumes of "early adopters" among young and tech-savvy IT & ITES employees) also account for some of the biggest startup successes in the B2C E-Commerce space.

View ET Now Startup Central's coverage of the study:



Business Standard has dived deeper into the Chennai angle:






Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

Mint-Venture Intelligence Deal Tracker (Sept 12)

Venture Intelligence is now powering the Deal Tracker on The Mint. The Weekly update is featured in the Deals Section on every Monday.


Below is the previous week's update:



Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


Chennai start-up failure rate lower than NCR and Bengaluru: Business Standard

A Business Standard article quotes Venture Intelligence data on investments & exits in startups across cities in India:


According to Venture Intelligence data, the failure rate among start-ups in Chennai between 2010 and 2014 was one per cent. The rates in Bengaluru and the NCR were six per cent and seven per cent, respectively.
Arun Natarajan, Founder, Venture Intelligence, said Chennai had higher resilience in the business-to-business (B2B) and software as a service (SaaS) businesses and that the city's start-ups had a clear focus on the business and revenue models. "Chennai does not follow the me-too concept," he said. 
Bengaluru and the NCR have a head start in large enterprises and these cities have investor communities willing to experiment with new ideas. Investors in Chennai, on the other hand, are more conservative and bet on good ideas.
Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


September 15, 2016

Edu-tech start-up ConceptOwl seeks to raise Rs100 crore: Mint

A Mint article quotes Venture Intelligence data on PEVC investments in the Edtech space
According to data from Venture Intelligence, the ed-tech space has seen investments worth $169 million, across 17 deals, so far this year, compared to $68 million that was invested across 20 deals in 2015.
Further Reading:

PE/VC Investments in Education spike up in 2016


Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

September 14, 2016

The Japanese & Chinese Connection in India

A Mint article showcases Venture Intelligence data on Chinese and Japanese VC and Strategic investors in India:


"According to data collated by researcher Venture Intelligence, till 5 September 2016, there were seven investments made by Chinese investors as against six in all of 2015 and 18 deals closed by Japanese investors against 21 in 2015. Against a total of 27 deals this year with about four months left to go, there were 28 investments made by Chinese and Japanese investors in 2015. 
However, there has been a decrease in the average deal size in 2016, specifically in the case of Japanese investors. While an investment commitment of $1870 million was recorded in 2016 through 21 deals by Japanese investors, it was just $138 million this year. On the other side, Chinese companies are still aggressive and making large investments. A total of $870 million has been invested by Chinese investors in Indian start-ups so far this year."

Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


September 13, 2016

India Value Fund Advisors to invest $40 million in SeedWorks: Mint

A Mint article showcases Venture Intelligence data on investments in Seed Companies in India:
"The largest was global private equity giant Blackstone’s $56 million investment in Nuziveedu Seeds Ltd in 2008, according to data from Venture Intelligence. Other significant investments in the space include Summit Partners’ $29 million in Krishidhan Seeds in 2010, $10 million by CLSA Capital Partners in Camson Bio Tech and $9 million in Ganga Kaveri Seeds by Samara Capital."



Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


September 12, 2016

Sequoia Capital in talks to sell stake in eight firms for $200 million: Mint

A Mint article titled Sequoia Capital in talks to sell stake in eight firms for $200 million, quotes Venture Intelligence data on investments and exits by Sequoia Capital.




Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

September 07, 2016

Startup ecosystem sees a consolidation wave: The Economic Times

An Economic Times article quotes Venture Intelligence data in the consolidation of startups: 
There were 28 M&A deals in the first eight months this year vis-a-vis 32 in the whole of last year, according to Venture Intelligence.

The article also quotes:

Deepak Natraj, Managing Director, Aarin Capital

"It's a clear case of consolidation. In many cases, the target companies are sub-optimal businesses, not having enough capital to expand their business verticals."

Anil Joshi, Managing Partner at Unicorn India Ventures

"Too many companies in the same space doesn't provide enough room for them to play. Also, the market is still nascent and not ready to absorb too many companies."

Sujayath Ali, Co-Founder, Voonik.com

"The sweet-spot for any startup M&A deal is technology. Most deals are struck for want of technological capabilities."

Related Stats:

In a study of Bridge rounds in India, Venture Intelligence identified 
"More than 250 startups, which between them have raised over $600 million in Seed/Series A funding, are now "overdue" to raise new money (ie, it's now 12+ months since their last round)."
Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


September 02, 2016

Does More Trouble Lie Ahead for Indian Startups? Knowledge@Wharton

A Knowledge@Wharton article quotes Venture Intelligence data while analyzing issues in the startup ecosystem in India:
"Venture Intelligence, a leading provider of data on private company financials, transactions and valuations, notes while from April 2014 to March 2016 there were around 29 acquisitions in the Indian tech startup space, from April this year to mid-August the number has shot up to around 40."
"Venture Intelligence also notes that in 2015, 16 VC-funded startups shut shop during the course of the year. In 2016, from January to July itself an equal number of startups have already folded up. These include Fashionara, PepperTap, Zippon and Murmur. Post July, shutdowns include Exclusively, a fashion portal which was acquired by Snapdeal last year, TaxiForSure which was acquired by cab-hailing app Ola last year, and online market place and classified portal Askme.com."
"...from January to June 2015, India saw PE investment of $7.31 billion across 373 deals and VC investment of $970 million across 242 deals. During the same period in 2016, PE dropped to $7.16 billion across 314 deals and VC dipped to $646 million across 211 deals."
What Lies Ahead?
Arun Natarajan, founder of Venture Intelligence, however, is more optimistic. He points out that several seed capital funds and India-dedicated VC firms including Sequoia Capital India, Kalaari Capital, Nexus Ventures and IDG Ventures India have raised new funds in the last 12 months. Also, several family offices, like that of industrialist Ratan Tata and the founders and executives of Infosys, have turned active startup investors. “So, there is sufficient ‘dry powder’ available within India to support new startups as well as existing portfolio companies [provided they are] able to demonstrate traction.”
Natarajan adds that given India’s growth potential, Indian startups “should also be able to attract sufficient long-term focused foreign investors as indicated by the increasing investments here by VC and strategic investors from Japan, South East Asia and China.” A recent example is the $175 million investment in August from Tencent, the founder of WeChat, China’s bestselling instant messaging app, and Foxconn Technology Group from Taiwan, in Hike, the Indian messaging app founded by Kavin Mittal. This is one of the largest investments in Indian startups in 2016 and values Hike at $1.4 billion.
...Mohandas Pai also shares - “India is sadly becoming a battleground for American and Chinese companies and Indian capital is losing out.” Pointing out that in China, 65% of VC funds is Chinese money while in India, only 5% comes from domestic capital, Pai says: “The Indian capitalists want assured returns with no risks. This mindset has to change. They should allocate at least 20% to 25% of their funds for venture capital.”

Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


September 01, 2016

When is a start-up no longer a start-up?

What exactly is a startup?

According to Y Combinator founder Paul GrahamA team of good people making something customers actually want and spending as little money as possible to do so.  

According to Stanford Prof Steve Blank: A startup is an organization formed to search for a repeatable and scalable business model.

According to #StartupIndia (ie, DIPP) an entity will be identified as a startup.
1. Till up to five years from the date of incorporation.
2. If its turnover does not exceed 25 crores in the last five financial years.
3. It is working towards innovation, development, deployment, and commercialisation of new products, processes, or services driven by technology or intellectual property.
4. Provided that any such entity formed by splitting up or reconstruction of a business already in existence shall not be considered a 'startup';
Now, Business Line has interviewed entrepreneurs and VCs to get their personal definitions.

Entrepreneurs:

K Ganesh, Portea Medical

A start-up moves to the next stage after it has “cracked the code.” That is, when it has been able to validate the business model. After that it is replicating the same proven model.” A seven-year-old company a start-up is like saying "a 20-year-old child".

A decade back, when a site handled 100 orders a day, it was considered good and investors would look at funding the venture. The venture was still a start-up but there was proof of concept. That number has changed. Now, 10,000 orders are required for proof of concept.

Sabarinath Nair, Skillveri

Skillveri is about four years old and “we are no longer calling ourselves a start-up” and stopping referring to themselves as a start-up had nothing to do with funding, but more to do with market traction. “Around the time we crossed cumulative turnover of INR 1 crore, that is the time internally we thought we should no longer call ourselves a start-up.”

Zishaan Hayath, Toppr 

A start-up is one that is growing fast. “When companies stop growing rapidly and become flat, they are no longer start-ups.”

Nipun Goyal, Curofy

“My thesis is as long as you are growing exponentially, you are a start-up. Also, if you have achieved self-sustainability, that is also the point where you tend to be a mature company.”

Investors:

Parag Dhol, Inventus Advisors India has an interesting take:

“Many people use 1,000 days as a marker.” There are various milestones for that migration. For instance, the venture shifts office a second time, the CEO no longer knows every employee by name, and the venture has raised Series A funding. 

Bharati Jacob, Seedfund

“a start-up remains a start-up till it is able to understand and define its business model. By business model, I mean who will buy the product or service, how will it be delivered, how does it fit into the consumer’s life, how will the company make money, how much will it cost to deliver – the legs and nuances of the business model.”

Whenever an entrepreneur starts a company, he or she does so with a hypothesis on the business model. Once the hypothesis becomes reality then the company ceases to be a start-up, says Bharati. “I wouldn’t measure a start-up in terms of years, rather in terms of evolution of its model,” she adds.

Karthik Reddy, Founder, Blume Ventures

It is the stability of the business model that determines whether a venture is still in the start-up phase or not. Its no more a startup - when the founding team moves away from product altogether on a day-to-day basis.

“The other more subjective metric around that is whether the business model itself has been iterated enough that the proposition is clear to the customer.” For Google and Facebook, he adds, this would have been at a scale when the advertiser knew exactly what it was buying when it got the click-throughs and could measure the cost per click.

Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


August 30, 2016

Chinese investors go head to head with traditional investors in investing in India: Business Standard

A Business Standard article, quotes Venture Intelligence data on investment by Chinese investors in India:
According to data from research firm Venture Intelligence Hillhouse has participated in the $65 million investments in two series in Cardekho and another $30 million investment into Hector Beverages, during 2015 and 2016.
Didi Kuaidi, a Chinese transportation network company, has participated in investing into online taxi aggregator Ola in a $500 million investment in September 2015.
Investment holding company Tencent, which has subsidiaries in media, entertainment and internet services, has invested into healthcare start up Practo, along with others, in a $90 million investment in August, 2015. 
Electronics company Xiaomi has invested along with others in Hungama in April, 2016.
In 2016, Ctrip.com, China's largest travel site, bought a stake in India's largest travel portal MakeMyTrip for $180 million (around Rs 1,200 crore). 
Steadview Capital has invested around $597 million in 11 investments into the country.
The article also quotes Venture Intelligence data on Japanese & Domestic investors:
The investments comes at a time when the Japanese investors including Beenos Partners and VC firm Rebright Partners are investing in various companies in the country. Beenos Partners has invested around 27 companies $213 million in India, while Rebright Partners made a total of $8 million in six investments in the country.
Meanwhile, the traditional investors continued their strong investments, in the country, led by Sequoia Capital (India) participating in 137 investments, which saw total funding of $2,457 million, including co-investment by other investors. Accel India participated in 98 investments, which saw total investment of $1,970 million, SAIF invested 72 times, which saw total investment of $844 million, Blume Ventures in 65 investments of total $285 million and IDG Ventures India in 64 investments for a total of $395 million, from the year 2014 to 2016, year to date. 
Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

August 28, 2016

Why GoZoomo shut down & returned VC money and What It Means

A TechInAsia article chronicles GoZoomo's story and its shut down: 

The issues faced by the peer-to-peer used car marketplace company were:
1. Poor unit economics due to low conversions for a peer-to-peer used car marketplace - around 20%.
“For instance, we are taking pictures, inspecting 100 vehicles, but at the end only 20 of these sell on our platform. Then it becomes very difficult to recover the money we have spent on all the 100 vehicles listed,” explains Arnav.
2. Need for the market to mature - in terms of accepting standardised pricing for used cars by customers
In the course of the exit, the company has:
1. Returned over half of the investment amount raised (i.e. money in the bank) to its investors SAIF and DST Global.
 2. Employees were given a seven-week severance package and offered help with finding placements elsewhere. “As of today, except six, all have been placed,” Arnav says.
On the shut down Alok Goel, SAIF Partners shares:
“The startup journey is very, very hard,” says Alok, who was earlier the CEO of FreeCharge until its acquisition by Snapdeal. “The entrepreneur takes a lot of risk and puts his life at stake by picking up entrepreneurship. During that stage, he is fighting all kinds of odds to survive and win. So it takes a lot of emotional and intellectual maturity on the part of the founder to take a decision like this.”
“This is probably the first time an entrepreneur is announcing this kind of a decision. Typically, when something is failing, an entrepreneur would try to show that his company is being acquired, while internally the story might be totally different. But these guys are sharing a lot of things in a transparent manner and taking this mature decision of returning money.”
The decision to return money has split views of the startup ecosystem players (entrepreneurs, VCs, journalists, startup enthusiasts, trolls). Here are some of the contrarian views:

Sumanth Raghavendra (@sumanthr) August 26, 2016:

How are GoZoomo's competitors - Cartrade, Cardekho, Droom et al - operating within the same market/rules if this is such a big issue?

Sandeep Aggarwal, Founder of GoZoomo competitor Droom:

What's wrong with Indian startup ecosystem, founders brag about returning VC money & VC feeling proud. Founder are better off not giving-up till end and review vision, strategy and execution and VCs should focus on returns vs refunds. As far as falsely claiming that India does not have pricing guide or benchmarking engine for used automobile, below pictures shows what founders do vs returning VC money (OrangeBookValue.com I.e. OBV, 75mn pricing queries, 25k products in catalog, tens of thousands of dealers and 30k transactions worth ₹650 cr to validate Obv results). #gozoomo, #saifpartners, #techinasia #donotbelame

 Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

August 27, 2016

Co-founder Quitting? Do you have these Protective Clauses?

"(Ashok) Arora, a B-Tech from IIT-Bombay (a colleague said he walked into the entrance exam unprepared and came out with flying colours), who wrote most of the critical programs for the company those days,  didn’t have the patience and sold his shares in the then unlisted company to the other co-founders for just Rs 25 lakh." - from a Business Standard article



Clearly, this was among the better managed and (in hindsight) most expensive co-founder exits that India has seen. Given that it had happened as far as back in 1989 - when forget templates for startup related processes existed, even startups were few and far between - the sum of Rs.25 Lakh for a struggling startup must have been a challenge for the other founders to generate.

According to Paul Graham, Founder of famed Silicon Valley-based accelerator Y Combinator, fights between founders are one of The 18 mistakes that KILL Startups. He further states that about 20% of the startups YC has funded have had a founder leave.


If companies of the caliber of Infosys and those backed by Y Combinator, face such serious challenges owing to a co-founder pulling out, how can other startups be prepared for such an event Ajay Jindal of Wisdomsmith Advisors advises (in a Businessline column) companies to insert protective clauses into the Shareholder Agreement (SHA) like:
1.  ‘All promoters, who are signatory to the SHA, shall devote their full time and attention to the company’. This means a promoter cannot do two ventures, or cannot walk out of a venture.
2.  ‘Promoters will not have the right to resign or leave the company without written permission of the investor’
3. ‘If a promoter does not wish to continue working full-time with the Company, such promoter will be required to sell all of its shareholding in the Company at minimum 75% discount to the price at which shares were issued in the round of funding immediately prior to such required sale. Investor and the remaining promoters will be entitled to purchase such shares on a pro-rata basis from such non-committed promoter’. 
What clauses should investors have?
1. Investor & Co-founders should acquire pro-rata the stake of the exiting founder. (The author believes this is not as draconian as investors reserving the right to acquire shareholding of all promoters at par, if any one promoter exits.)
2. Insist on a clause whereby any exiting or non-committed promoter should cease to be a director of company immediately (even though their shareholding may continue). 
3. In case the exiting promoter was vital to the business, then the investor may consider invoking material breach to allow the investor to force a sale of the company.
4. Having a Non-Compete Clause including barring the leaving promoter from hiring employees of the company. The time period for this is typically 3 years and can be upto 5 years as well.
5. Another small clause to prevent an indirect exit of promoter(s) is to bar them from pledging their shares to any third party, without written permission of the investor.
Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


August 26, 2016

Making Indian Entrepreneurship More Desi

Cross posted from The Startup Journey Blog

Writing in Founding Fuel, Baba Prasad, CEO of Vivekin Group who teaches entrepreneurship in B-Schools, bemoans the fact that a lot of the students would like to emulate the founders of companies like Facebook and Amazon and do not even bring up names like Narayana Murthy of Infosys or Azim Premji of Wipro, leave alone older names like Laxmanrao Kirloskar or Jamsetji Tata. "So, if business models for Indian entrepreneurs are fashioned in the West, and business heroes are not Indian, the question comes up: What is Indian about the Indian entrepreneur?," he asks.

According to the article, the crux of an Indian Entrepreneur is:
1. Balancing profit-making with the burdens it is imposing on society and the benefits it can deliver to society 
2. The entrepreneur is solving problems, that are not uniquely Indian, but the scale is Indian. 
Contrasting the Western/Capitalist model and a not-too-practical Gandhian/Socialist model, the author provides Aravind Eye Hospital as a balanced template for the new Indian model:
Aravind Eye Hospital, established in 1976 in Tamil Nadu by the visionary Dr G. Venkataswamy (popularly called Dr V), is an excellent example of such blending. Over the last 40 years, it has performed millions of screening tests and hundreds of thousands of cataract surgeries. The unique business model draws on a for-fee model to fund its free services. The problem of eye care is not uniquely Indian, but the scale of the problem is definitely Indian. And Aravind Eye Hospital’s business model makes the solution for eye care a typically Indian blend of the Promethean and Gandhian models.
A characteristically Indian model would be one that alongside profit-making considers the burdens it is imposing on society and the benefits it can deliver to society. It is a tough ask, and it is individually negotiated with each entrepreneur finding his or her own balance through self-scrutiny is the one who will be truly free and capable of innovation.
Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


August 25, 2016

RBL Bank: PE Backed IPO Analysis



Login into the Venture Intelligence Deal Database and click on the below links to view transaction and other details:


Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.


August 24, 2016

What's Next for Fintech?

Data from the Venture Intelligence Venture Capital Deals Database shows that, even in 2015, when E-Commerce/Online Retail was ruling the roost (grabbing over 45% of the investments), Fintech investments had accounted for as much as 15% of the VC investment pie.

An Economic Times survey of VCs published last week found Fintech to be the most favoured sector for investments in the next 6 to 12 months. Venture Intelligence data shows that Fintech investment have been picking up after falling for two quarters following the high in Q3'15. Clearly, this is one sector where VCs are becoming more and more comfortable to deploy their "dry powder" (or uninvested capital). 


Among the most active VC investors in the sector include Accel India (MoneyView, Quiklo, Scripbox), Sequoia Capital India (Mobikwik, Cleartax) and Kalaari Capital (CreditVidya, Active.ai). Social VC or Impact Investors are also enthusiastic with Aspada Investments picking up stakes in NeoGrowth and CapitalFloat and Omidyar Network in Scripbox and NeoGrowth.



Significant startups in fintech sectors which raised funding in H1'16 include:

1. Payments: ftcash, Mobikwik and QwikCilver

2. Marketplaces for Mutual Funds & Insurance products:  Scripbox, EasyPolicy, TurtleMint

3. SME Lending: LendingKart, NeoGrowth (apart from Capital Float, which owing to it being originally founded in 1993, technically does not qualify as a startup).



What's Driving the Fintech Momentum?

With much dissatisfaction against incumbent lending institutions and large gap between formal lending supply and credit demand in the country, VCs seem poised to invest heavily in disruptive startups of all flavours - B2B, B2C and P2P - in the lending segment .


With the Microfinance crisis fresh in memory, VCs have not been too venturesome in backing peer-to-peer lenders thus far. Even though it has not been without criticism, the fact that the RBI has put out a consultation paper on P2P lending seems to have eased fears on any ham-handed action. The Government of India for its part has been putting in several enabling infrastructure elements in place - including Aadhaar, JAM Scheme (pdf), Unified Payment Interface (pdf), etc - that Fintech companies, along with other players, can exploit.

What do you think is the future for Fintech in India? Chime in the comments.

To track Deal Action in the Fintech space


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