India needs early stage capital today. The market is large and is ideal for an investor who can cherry pick the companies who he can back. I see no reason to sacrifice returns and join the crowd....I just feel there is more money to be made in the long run by building a very traditional Silicon Valley-ish Venture Capital firm investing in india.
Where is the actual investment opportunity, specific to the Indian market? Non-tech, growth capital opportunities outnumber tech, venture capital opportunities by an order of magnitude. Possibly even higher, if you apply a quality filter. Indian IP/tech startup scene is fast improving, but is still a few years away from critical mass.
So, what am I saying. There is a 'sweet spot' in not-so-large companies requiring expansion capital to scale up a proven business model in non-tech sectors. As of now, this spot is sweeter than early-stage tech.
Arun Natarajan is the Founder of Venture Intelligence India, which tracks venture capital activity in India and Indian-founded companies worldwide. View sample issues of TSJ Media's Venture Intelligence India newsletters and reports.