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Showing posts from March, 2011

Profile of wireless home theater system firm Snap

Business Today recently published a profile of Snap Networks, a Bangalore-based maker of an innovative wireless home theater audio system , which is is seeking to raise $3-5 million in venture funding.
The sound system, branded Violet, consists of a set of five wireless speakers, a sub woofer, a transmitter, a micro controller and a remote control. But the coolness factor stands on two legs: one, the speakers can be screwed into a light bulb holder or plugged into an electric source with a bulb holder adapter. Michael Foley, one of India's top names in industrial design, came up with the nine-pin or trophy-like design for the speakers.

Two, it delivers a home theatre feel anywhere in a room unlike the traditional 5.1 speaker set-up. "We have moved away from the conventional equilateral triangle approach used to set up a home theatre system and rely on our chips to build a circle of sound for users, so that the surround sound effect is not dimmed anywhere in the room," A…

When Venture Capital meets Agriculture

Economic Times recently published an article on the various types of agri-businesses are increasingly attracting VC attention. In an accompanying piece, Sandeep Singhal and Manoj Gupta of Nexus Ventures, provided their outlook on the sector.
The agriculture sector presents a tremendous opportunity, given its size and large-scale inefficiencies, but building a large company is not easy. It requires domain knowledge, as local issues such as weather, pests, soil conditions, and water availability, and global factors such as commodity price swings can play havoc with any plan. On the supply side, their business model has to support a dispersed network, with the support of field activities and the need to work in different languages. Depending on where they play in the ecosystem, the company's systems and processes should be able to handle large numbers of cash transactions and prevent fraud and leakage. All of this is further complicated by the need to manage risks related to governmen…

Challenges facing Indian Infrastructure Investors

Writing in the Business Standard, hedge fund manager Akash Prakash points out some of the India-specific challenges in investing into this sector.
The reality is that the Indian infrastructure sector does not have the size, financial muscle and market clout to fund the infrastructure this country needs. While power projects may still go ahead, as we have 4-5 large power developers with a combined $28 billion of market cap, $27 billion of market cap has to support everything else from roads to ports, airports, sanitation, etc. Again, the needs dwarf the capital, which can be raised.

...Thirdly, markets have ignored the sector, given the poor economics demonstrated. Most infra projects/developers generate no-free cash flow, have low ROE’s and are very susceptible to project delays and policy risk. Investors are tired of projects stuck in red tape or subject to the whims and fancies of ministers. Most of the large infra projects are also seen to be disguised bets on real estate, as their e…

Infrastructure Investing: Advantages and Pitfalls

At a time when India- and Asia-focused infrastructure funds are being announced at a rapid clip, Jay A. Yoder, Partner and Head of Real Assets at fund-of-funds firm Altius Associates, provides an analysis of the advantages and downsides of this asset class in an article published in AltAssets. Extracts:

The advantages
Adding infrastructure to an existing portfolio can be expected to provide investors with several important benefits, including attractive returns, moderate risk, diversification, and inflation hedging.... We believe that the best private infrastructure managers can provide net returns to investors of 10 to 14 per cent... At the same time, we expect the volatility to be moderate; somewhere between equities and fixed income. Infrastructure assets are likely to provide a good hedge against inflation. Most infrastructure-related contracts contain clauses that allow for price increases tied to inflation....Our view is that an overweight to the energy subsector greatly increase…

Mushrooming of Mentors

Deepak Srinath of Viedea has an interesting post on the subject:
...the trend that has left me partly amused and partly concerned is the rapidly growing breed of entrepreneurs who are in the “business of mentoring and incubation”. I have interacted with many such “mentors” over the last few months and barring a few exceptions most have left me with the feeling that they do not have adequate experience or skills to mentor a startup. Some of them are barely out of college themselves and many of them claim to be serial entrepreneur s (on closer inspection, it’s more like ‘serial company starters’, none of which have managed to last beyond a year). It’s extremely worrisome that young entrepreneurs with smart ideas could be signing up such mentors, giving them equity and wasting a lot of time in the bargain.

A good mentor is a critical part of an entrepreneur’s journey. A few tips for entrepreneurs from my own experience –

... 2. You may need multiple mentors on your entrepreneurial jour…

Deal Alert: SCIOinspire acquires US healthcare audit firm National Audit

SCIOinspire, a provider of healthcare payer cost containment solutions, has acquired Florida, USA-based National Audit. Technology Holdings was the exclusive advisor on the transaction.

National Audit is a leading healthcare claims audit and overpayment recovery services provider to large commercial, Medicare & Medicaid payers and Pharmacy Benefit Managers (PBMs). National Audit works with 3 of the top 7 healthcare insurance payers in the United States. SCIOinspire is a premier provider of cost containment services and technology solutions to over 40 health plans including care management analytics, disease management support, underwriting & actuarial support, and third party liability & recovery services.

SCIOinspire's investors include Sequoia Capital, Health Enterprise Partners and Silicon Valley Bank. Technology Holdings was earlier the sole advisor on SCIOinspire's acquisitions of Socrates (healthcare payer subrogation) and Solucia Consulting (care management an…

Deal Alert: StanChart PE invests Rs.85-Cr in Privi Organics

Edited excerpts from the Press Release:

Standard Chartered Private Equity (SCPE) has invested Rs.850 million in Privi Organics, one of India’s leading aroma chemical manufacturer and exporter. Mumbai-based Privi exports its products to over 25 countries and has established itself as a key supplier to several of the world's largest fragrance and flavours companies. This funding will part finance the growth plans of the company’s business through expansion of manufacturing facilities at Mahad, Maharashtra and also support key backward integration projects.

Rahul Raisurana, Managing Director, Standard Chartered Private Equity, said, "The aroma chemicals space presents significant opportunities for Indian companies, as India emerges as a key manufacturing center for aromatic and speciality chemicals. We have found Privi Organics to be the right partner because of its strong chemistry skills and quality manufacturing strengths that are well recognized by its global customer base.&qu…

Deal Alert: Inventus Capital invests in search marketing tech firm Sokrati

Edited excerpts from the Press Release:

Sokrati, an US- and India-based Digital Marketing Technology Platform founded built by three ex-Amazon executives, has raised Series A funding from Inventus Capital Partners. John Dougery and Samir Kumar of Inventus will join the Sokrati board. The funds will be utilized to Sokrati's reach internationally and build a unified, scalable and intelligent Online Marketing platform for Advertisers and Agencies alike.

"The funds will be utilized to expand our reach internationally and build a unified, scalable & intelligent Online Marketing platform for Advertisers & Agencies alike", said Ashish Mehta, CEO of Sokrati.

Sokrati was boot-strapped in January 2009 and over time, has built an automated Search Marketing technology. It delivers & optimizes over 15 million Impressions per day within the Paid Search Marketing channel. Its advertisers range across e-Commerce, Travel and Classifieds space.

The Managing Director of Inventus A…

The Mast Kalandhar Formula

From the Forbes India profile of VC-backed North Indian restaurant chain.
Today, Mast Kalandar has 22 outlets and a clear plan to reach 100 before the end of next year. And then, 500 more. And all this using the almost bland cuisine positioning: “Authentic, vegetarian, homemade style North Indian food.” Wasn’t eating out all about escaping homemade food? Increasingly, there’s a new category of customers frequenting restaurants: They eat out or order in because they don’t want the hassle of cooking at home. They include working professionals who don’t have the time or knowledge for everyday cooking, or newly married working couples who don’t want to deal with dirty vessels, maids and grocery. That is the primary market Mast Kalandar is targeting.

...Its decision to offer freshly cooked meals is both its biggest differentiator and its biggest execution risk. “Over 30 percent of our customers dine more than six times a month with us,” says Gaurav. The restaurants seat 55-60 people, who spe…

Vocational Training - Teamlease Style

Forbes India has an article on how staffing services firm Teamlease is transforming the vocational training firm IIJT that it acquired in March 2010.
If the term “university” evokes images of quadrangles, high ceilings and large windows, perish the thought. IIJT centre in Bangalore is a three-storied building not far from the bustling shops of Brigade Road. Inside, students in their late teens or early 20s occupy the classrooms — some so narrow that each row seats only four. The small, sparsely furnished offices behind the reception double up as interview rooms for visiting companies.

Not your typical university campus. Yet, this could do what some of the colleges have failed to do — produce employable students. The centres would be small, functional, located close to students and most importantly, cost less. TeamLease has centralised common functions (such as HR, legal, finance and IT) even to the level of trainers. Star trainers are hard to get in the hinterland, and expensive to hire…

Ashish Dhawan to move on from ChrysCap in 2012

Leading India-focused Private Equity firm ChrysCapital - two time winners of the "Best Private Equity Firm of Year" award at the Venture Intelligence APEX Awards - has announced that its founder Ashish Dhawan, will transition out of the firm in mid 2012 to pursue work on social issues.

Also, Brahmal Vasudevan, one of the firm's managing directors who has been at the firm since 2000, will be leaving ChrysCapital later this year. Going forward, the ChrysCapital team will be led by the remaining six managing directors – Ashley Menezes, Gulpreet Kohli, Kunal Shroff, Ravi Bahl, Sanjay Kukreja and Sanjiv Kaul.



Ashish Dhawan of ChrysCapital receiving the Best Private Equity Firm-2009 Award from Ajay Piramal of the Piramal Group

Excerpts from the ChrysCapial Press Release:

ChrysCapital prepares itself for management transition to a collective leadership based on equal partnership ChrysCapital Investment Advisors, one of India’s leading investment advisors, is preparing itself for a…

Profile of Pharma Retail chain Guardian Lifecare

From the profile in Economic Times:
According to him,45,000 crore worth medicines are sold by largely fragmented small pharma shops controlled by about 7.5 lakh chemists across the country.I found that a small retail shop that can offer all medicines under one roof will help attract customers, he says. He started the business in 2003 with 10 crore pooled in from family members,friends and his own savings. The first outlet was set up in the NCR region and later opened another one in Delhi.

What changed the future of the business was its exclusive master franchisee agreement with GNC in 2004,considered to be the worlds largest chain for vitamins and health products.Subsequently,it has also partnered with Yves Rocher,a France-based natural beauty company.

...In 2008,Guardian received its first round of funding from Samara Capital.It had invested 100 crore in the company. Though started as a company focusing on northern market,Guardian now has a presence in southern markets including Tamil N…