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Showing posts from November, 2012

Deal Alert: BSE to allow firms to SME platform only after site visit

Business Line
The Bombay Stock Exchange (BSE) has issued new conditions for listing of companies on its SME platform through IPO. These include a visit to the company’s site undertaken by the BSE before granting of approval to use the name of the exchange in the offer document. Additionally, the company should also file a compliance certificate by a Practicing Company Secretary according to the guidance note issued by the Institute of Company Secretaries of India. 
BSE is also replacing the existing guidelines with new guidelines for migration from SME Platform to the main board of the BSE. Under the new eligibility criteria for migration, companies have to be mandatorily listed and traded on the SME Platform for a minimum period of two years.

Deal Alert: Swipe Telecom to raise $20-M

Business Standard 
Pune headquartered Swipe Telecom India Pvt Ltd is in talks with two Indian firms and one US-based firm for raising $20 million (Rs.110 crore approx) through private equity route for expansion, branding and innovation of its products which include mainly tablet PCs. 
The company has earlier raised $10 million (Rs.55 crore approx) from Mantra Ventures. The company plans to expand outside India by end of January 2013, entering Ireland and US markets.

Deal Alert: Impact Circle invests in K-12 firm Sudiksha

Economic Times
Impact Circle, a new social ventures focused angel investor network, has made its first investment in Sudiksha Knowledge Solutions Pvt. Ltd., a Hyderabad-based education services provider. Sudiksha is presently owns and manages 18 schools in Andhra Pradesh, 12 are in Hyderabad and 6 in rural Andhra Pradesh. Our 12 schools in Hyderabad are managed by women entrepreneurs. 
Impact Circle, which has the backing of institutional investors such as Ennovent, Switzerland’s Rianta Capital, and the Michael and Susan Dell Foundation, will provide seed capital ranging from $25,000 to $1 million (Rs.14 lakh to Rs.5.5 crore) to very young social ventures. The investments will be either direct equity or compulsory convertible debt investments, and will be for 5-7 years. 
Impact Circle members include senior corporate executives such as Anurag Jain, who led delivery services at Dell; Joydeep Mukherji, a former American Express executive; and Sadeesh Raghavan, former managing director a…

Deal Alert: Flipkart to be probed along with Bharti-Walmart for FDI violations

Economic Times
The Enforcement Directorate will look into the alleged violation of FDI regulations by e-commerce company Flipkart Online Services and cash & carry retail chain Bharti Walmart. The RBI has referred matters related to the alleged circumventing of law by Flipkart to the Enforcement Directorate. Flipkart is under the scanner for allegedly flouting FDI rules which allow e-commerce companies with foreign investment to carry out business-to-business or B2B transactions but not business to consumer or B2C transactions by creating complex structures that may not be permissible. It is alleged that Flipkart has flouted these rules. 
From the Venture Intelligence PE Deal database: Flipkart has raised $180-M from investors including Tiger Global and Accel India.

Deal Alert: Saab, QuEST establishes aero-structure assembly JV

Economic Times
Bangalore-based engineering services firm QuEST Global has set up a 74:26 joint venture with Swedish defence and security company Saab to set up an aero-structure assembly venture. The partners will together invest Rs.55 crore to set up the new entity, to be based in Belgaum in Karnataka. The unit will manufacture specific parts and assemble substantial sections of commercial aircraft such as Boeing 787 Dreamliner and Airbus A320 and A380.

Deal Alert: Y Combinator VC program sizes down funding to $80k

StartupCentral
Mountain View, California-based Y Combinator, one of the world’s most successful start-up accelerators, has announced that as part of its ongoing venture capital program, it will now invest $80,000 per startup instead of the earlier $150,000. The revamped program will partner with four venture capitalists — Yuri Milner, Andreessen Horowitz, General Catalyst, and Maverick Capital — who will each invest $20,000 in the program. Investments will be made as convertible notes with no valuation cap and no discount. Since its inception in 2005, the accelerator has funded over 460 start-ups, including Reddit, Clustrix, Wufoo, Scribd, Disqus, Dropbox, Airbnb and Stripe.

Deal Alert: Times Internet acquires online men mag MensXP.com

Times of India
Times Internet has acquired MensXP.com, a lifestyle portal for men with channels including fashion, technology, health and entertainment. It was founded three years ago by entrepreneur Angad Bhatia. The aim of the acquisition is to further improve the content on MensXP and expose it to a larger audience. The MensXP team will be absorbed into Times Internet.

Deal Alert: The Hatch incubates online merchandise firm Poster Gully

The Hatch for Startups is incubating Poster Gully, an online store for posters, art prints, key-chains, stickers, badges, sweatshirts and other merchandise of popular bands, brands, schools & colleges. Aseem Sadana, co-founder of Isango, is The Hatch mentor for Poster Gully. Poster Gully was founded by Bharat Sethi and Anuvi Srivastava.

Deal Alert: Med devices firm OneBreath to raise $3-M from Omidyar, others

NextBigWHat

Bangalore based OneBreath, a medical devices company, founded by A Vijay Simha, is to raise $3 million from a consortium of investors led by eBay founder Pierre Omidyar’s philanthropic firm Omidyar Network. OneBreath is developing low cost portable ventilators scheduled for launch by next year. The company plans to apply for US FDA approval in 2013 and will set up manufacturing facilities in India and China.

Deal Alert: AdNear raises Rs.35-Cr from Canaan, Sequoia

Economic Times 
Bangalore-based AdNear, which offers a location-based mobile advertising platform, has raised Rs.35 crore in a first round of funding from VC firms Canaan Partners and Sequoia Capital India. The funds will be used by the start-up to expand its presence across the Asia-Pacific region, including Australia and New Zealand, as well as towards building its team.

Deal Alert: MakeMyTrip acquires majority stake Thailand’s ITC Group for $3.2 M

Press Release
Nasdaq-listed MakeMyTrip Ltd. has acquired a majority equity interest in Thailand-basedITC Group for $3.2 million. The ITC Group comprises of International Tour Center Co. Ltd., ITC Bangkok Co. Ltd. and ITC South Co. Ltd. MakeMyTrip paid $2.2 million to the existing shareholders for the sale of their shares in the ITC Group and paid $1 million for subscription of new shares in the ITC Group. 
MakeMyTrip will also acquire the remaining shares of the ITC Group from the existing shareholders in cash, payable in four tranches, over an earn-out period ending December 2016. 
From the Venture Intelligence M&A Deal database: MakeMyTrip’s previous acquisitions include Hotel Travel Group (Nov-12), My Guest House Accommodations (Nov-11), Ixigo (Aug-11), Luxury Tours & Travels (Feb-11) and Ticketvala (Feb-10).

Deal Alert: Patni brothers acquire stake in Grameen Capital; IFMR Trust exits

Economic Times
Amit and Arihant Patni, the sons of Patni Computer co-founder Gajendra Patni, have bought a 43.17% stake in Grameen Capital India (GCI) from former investor IFMR Trust. The brothers expect no commercial returns from this investment. GCI is a non-profit social investment bank that has mobilized Rs.700 crore of capital to micro finance institutions and other social enterprises serving the base-of-the-pyramid segment, reaching out to 1 million beneficiaries at last count. It is now looking to set up two new funds - a debt fund for social enterprises and a social equity fund.
Early last year the Patni brothers co-founded VC fund Nirvana Venture Advisors, which focuses on investing in Internet companies in India. Nirvana is still in the fund raising phase and the brothers expect to close it at $60-75 million. 


What does India's first Super Angel Rajan Anandan look for?

YourStory has an interesting interview with him on the sidelines of ISB Digital Summit where he keynoted.

Extracts (emphasis mine)
First, I look for interesting ideas in technology that can create an impact.

The second most important thing is the team; except for two companies, all my founders have a technology background. I almost never back a non-tech founder in technology business, because in technology startups you have to iterate really really fast and for that you need a strong understanding of technology. Outsourcing is always a bad idea.

Number 3is engineering + product expertise.

The Number 4 criterion is I look for commitment to the idea in founders. They must have left their secure jobs, must have faced several setbacks but should have never given up. Ability to attract top talent is very important. For example, Druva is a perfect example of sales + product + engineering. Right founding team is very important. Look at Capillary; they seem to be having an amazing a…

What holds back the Angels?

Businessworld has an interesting Cover Story focused on Angel Investments - or rather their lack.

The article starts of with data from Venture Intelligence showing how the recognized angel networks and well known individual angel investors have together funded about 50-60 startups last year, which is a tiny fraction of the angel investment activity in in the US and even China.

The article also has an interesting table on the ratio of companies that apply for funding to the angel networks are actually successful in raising capital. In FY12, Chennai Angels received 123 applications and funded 3 companies, while Mumbai Angels received 100+ applications and funded 12. Indian Angel Network’ numbers were eye-popping: It received almost 5,000 applications; met with 50 of those companies and finally funded 11!

Issues faced by the angels:Quality of Startups
The article quotes Hemant Kanakia, a Silicon Valley based angel investor who also invests in India as part of IAN saying that there is…

Clean Energy: The Promise & The Pain

Businessworld has a Cover Story on the topic with special focus on the travails of wind energy in Tamilnadu, hydel energy in Uttarakhand and the emerging rooftop solar opportunity.

Tamil Nadu has an installed capacity of 6,969 MW, or 40 per cent of our total wind energy capacity of 17,352 MW and 28 per cent of the total renewable energy capacity. Wind energy also accounts for 12.64 per cent of the electricity generated in the state (9,763 MU out of 77,218 MU). More than 95 per cent of the country’s wind energy potential is in the coastal states of Tamil Nadu, Andhra Pradesh, Karnataka, Maharashtra, and Gujarat. And while Karnataka has the largest potential, best wind sites are in Tamil Nadu. Four prominent passes in the state — Palghat, Shencottah, Aralvoimozhi and Kambam —  have average annual wind speeds ranging from 18 km/hr to 25 km/hr. In Karnataka, the average is about 10 km/hr. Tamil Nadu, however, is power deficit — the average power availability in 2011-12 was aro…

Mobile.com: Listen to ads; get free talk time

From Businessworld:

Now, Sistema Shyam Teleservices (SSTL), that offers CDMA-based mobile services to 17 million subscribers under the MTS brand, will offer free talk time to subscribers soon, provided they watch a 15-second video advertisement before making a call. The video mobile ad platform—MTS mAd Call—will initially offer this service to MTS subscribers with Android devices. Over the next few months this service will be extended to all devices on the MTS network.
On a given day, the subscriber with data connectivity on the MTS network will have the option of watching four such videos. Should callers choose to watch an ad, each call will fetch them 60 seconds of free talk time. There are no data charges for downloading the advertisement. At the end of the day, the subscriber can accumulate up to 240 seconds (4 minutes) of free talk time with lifetime validity, which can be used to call any mobile or fixed line in the country.  ...As the service evolves, the subscribe…

Power Crisis Looms as Private Sector's Enthusiasm Wilts

Businessworld has recently covered the crisis in the Indian power sector and the problems facing private sector investments in the sector.

From the Cover Story titled "Burn Ambitions":

If there is an apparent sliver of hope, it’s over discoms — the Cabinet Committee on Economic Affairs’ nod to recast their debt of Rs 1,20,000 crore. Matters had come to head. In the absence of cost-reflective tariffs (a political hot potato), discoms financed the interest on loans through more of the same. The RBI asked banks to apply the brakes on loans to discoms. “We have decided to stop generation, but we cannot afford to take a deferred payment as 80 per cent of our cost (of power) is for buying coal. We pay CIL through a letter of credit and cannot afford this. We can’t compromise,” says NTPC’s Choudhury.
...According to Crisil, nine states — Tamil Nadu, Andhra Pradesh, Rajasthan, Punjab, Haryana, Bihar, Uttar Pradesh, Madhya Pradesh and Jharkhand — account for 85 per cent of …

QSR or Fine Dining: The Dynamics

Extracts From Business Today:

...the fine and casual dining sector - currently estimated to be around Rs 3,000 crore - has customers eating out of its hands.... With all the big players gung-ho on expansion, fine and casual dining is expected to touch Rs 10,000 crore by 2015.   
 ...Restaurants come in two broad formats - the fine or casual dining chains, and the quick service ones. The fine and casual dining formats are essentially the same, varying only in prices charged: thus restaurants such as those which are part of the Taj Hotels would be classified as 'fine dining' ones, while the likes of Mainland China and Spaghetti Kitchen fall in the casual dining category.

The economics of the quick service restaurants (QSRS) are very different. The success of the latter - such as McDonald's, Domino's or Pizza Hut - is apparent; indeed, Jubilant FoodWorks, which holds the franchise for Domino's, also listed successfully on the stock market in 2010. QSRS h…

Monetizing Mobile Games

From  a Business Today article:

Some pack in ads, while others like Kejriwal shun them but charge users to download games. Those choosing the latter option also have to decide where to display their games: on operators' sites such as Vodafone Live or Airtel Live or at app stores such as The Nokia Store or Google Play.

"The ad-funded model is not gaining much scale," says Samir Bangara, Managing Director, Digital, Disney UTV. His company charges users to download the premium versions of its games and earned Rs 54.5 crore in revenue for 2010/2011, mobile games being the largest contributor to its top line. But not everyone agrees with him.

Indore-based Twist Mobile, for instance, banks solely on ads for its revenue while keeping all versions of its games free. It has 30 games, of which the most popular is Zulux, with seven million downloads.  ...The jury is still out on whether telecom operators' sites or app stores make for savvier distribution. There is a…

Deal Alert: Brandis Manufacturing and Marketing Private Limited raises INR 70 crores from Peepul Capital III LLC

From the Press Release:
Brandis Manufacturing and Marketing Private Limited, a fast emerging player in the Lingerie and the men Active-wear segment, today announced the successful conclusion of a fund raise of up to INR 70crores, in multiple tranches, with Peepul Capital Fund III LLC as the sole investor. Brandis Manufacturing and Marketing Private Limited is in the process of building national presence in the Lingerie and the men Active-wear segments through its brands BEYOUTY and 2GO respectively. 
The women apparel market in India is INR 72,050 crores and the lingerie market contributes to 10.83 % of the total women apparel market in India. The highly fragmented lingerie market is pegged at INR 7,800 crores growing at 12% per annum, with very few consolidated brands. 
“Brandis aims to become a significant player in the fragmented women innerwear segment in the next few years. There is a huge gap in the expectations of women consumers and the brand offerings in the segment. Brandis…

Strategic Investor Interview with Joydeep Bose of Cisco

The following interview with Joydeep Bose, Senior Director, Corporate Development, Investments and Acquisitions at Cisco appeared in the latest quarterly Venture Intelligence India Venture Capital report.
Venture Intelligence:  Can you start by providing us a quick overview of Cisco’s venture investment activities in India.

Joydeep Bose:
Cisco Investments and M&A group is focused on investing in India’s growing markets in technology areas such as Video networking and social collaboration, Cloud Computing and enabling software. India is a key geography for Cisco both as a market and as a source market for innovation. We have seen a huge investment opportunities in India, especially in the areas of cloud and broadband services, media and entertainment and the traditional Indian industry strongholds such as software and advanced services. We are also seeking faster the adoptions of technologies like LTE and national broadband network in the Asia Pacific and Japan regions. India ranks …