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The reason, according to Sumanth Raghavendra - in his post titled " Why a prize idiot like Rahul Yadav is precisely the kind of startup hero India deserves…and exactly the opposite of the one it needs " - is our "obsession with funding". First a quick extract from Sumanth's post : Despite all the buzz around India having arrived as a hot startup destination, there have been precious few aspirational startup exemplars since the halcyon days of  Sabeer Bhatia and Narayan Murthy. A false dawn if ever there was one… Equally tragic is the fact that folks who could potentially be startup heroes—a Sachin Bansal or a Vijay Shekhar Sharma—seem to be idols with feet of clay…either backing the likes of Rahul Yadav with angel investment to continue this cringe-worthy charade of faux startup-ism or needing him to fill seats at their own events. How I wish the media highlighted the story of a Santosh Panda who has diligently persevered to build Explara over sever...

Mukund Mohan of Microsoft Ventures has a numbers-based post on the probability of funding and the equity dilutions Indian entrepreneurs face depending on whether they go to an Accelerator first versus VCs and Angel Investors. The first scenario for you, the entrepreneur, is to get funded directly by a VC . The chances of that happening in India are low – 1.4%.  The other challenge is that those companies got relatively poor valuations (average about $1.4 Million pre money). Only 19 out of 1300 entities got funded last year to raise their series A through a VC directly. In this case you will possibly dilute 30-40% and still own >60% of the company . I have used 30% dilution in the chart below. The second scenario is to get angel funding and then in 18 months get VC funding. The chances are better that you might go through this scenario (2X more – 43 companies got angel funded last year), and then venture funding. You will end up owning 56% of your company (by g...

Vijay Anand of accelerator The Startup Centre has an interesting post on how entrepreneurs often end up wasting precious time by getting all excited about the research expeditions of associates at VC firms. When you get an email or a call from a VC Firm, the first question to ask is to get them to introduce themselves. If its an associate – or if you are getting an email, check up on the site of the firm and see if their name or picture is listed anywhere – just ignore them. They are timesinks and just doing their homework for the monday meeting where they have to present a list of companies. ...It takes us (at the startup centre) atleast three weeks to get a team back and focused on the product and business, once they get one of these stupid emails. The team thinks they are already fundable, and someone from a VC firm reached out to THEM! OMG. ...I came across another startup earlier this week which is chasing a fund that does typically series B rounds, and the indivi...

Edited excerpts from the press release: Ventureast Life Fund, an early growth and growth stage fund focused on the food and agriculture, clean environment and healthcare delivery sectors, has invested Rs.25 crores in VKS Farms , a Coimbatore-based, integrated meat processing company. Shekhar Kundur, General Partner of Ventureast, joins the Board of VKS Farms. The funding will be utilized for completing VKS's back-end operations, and expanding its retailing capability. VKS's differentiation stems from its diverse product mix of chicken, egg, meat and salt; integrated poultry supply-chain, spanning 'grandparents' to commercial birds facilities to processing to retailing; exports to over 30 countries, besides domestic presence; and state-of-the-art processing plant built to international standards. Shekhar Kundur said, “Hygienic meat retailing is the way forward in this unorganized market. With a comprehensive and efficient supply chain in place, we expect VKS Farms t...

In an article for AltAssets, Charles Fletcher of US law firm Taylor Wessing describes how, in the absence of VC funding for capital intensive projects, cleantech compannies can look at alternative financing sources, including state-sponsored finance, licensing techniques and other models of co-development, which take their cue from the biotech sector. Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of data and analysis on private equity, venture capital and M&A deals in India. View free samples of Venture Intelligence newsletters and reports. Email the author at arun@ventureintelligence.in