Angels
Land at Entrepreneurs to Tap Capital Pool
Web-based
startups connecting local entrepreneurs with angel investors & VCs
Matchmaking sites have long been common in India, successfully bringing together tens of thousands of individuals into happy matrimony. Now, a bunch of internet firms are attempting to do the same in the entrepreneurial realm. Drawing inspiration from the runaway success of internet funding platforms in Silcon Valley, a clutch of four new webbased startups are using technology to connect cash-starved local entrepreneurs with angel investors and venture capital firms. Aimed at addressing the dearth of seed and early-stage capital in India, these new ventures are democratising the process of funding by making it possible for anyone with an idea to pitch business plans to potential investors online. One of the more prominent among them is Venturefund-.com, founded by a group of marquee investors who include Rajan Anandan, managing director of Google India, serial entrepreneur Paul Shoker and entrepreneurs such as UK-based Lord Waheed Alli and former ad-man turned entrepreneur-cuminvestor Ashok Mathai Kurien. “We noticed a big gap in the start-up ecosystem both in terms of raising capital and mentoring startups which our online platform can facilitate,” said Shoker, who sits on the boards of eretailers such as theprivatesales.com and Koovs.com. Venturefund.com follows a simple process — startups looking to raise capital register themselves on the platform, and this information with the company’s name withheld is sent to investors. If an investor shows interest in the company, the platform charges the startup $195 for carrying out the introduction and supporting it with mentoring to help facilitate the fundraising. It’s a model made popular by AngelList, a web-based platform in the United States, which has helped more than 1,000 startups raise about $ 1 billion in the last two years. While this service is a huge boon for cash-starved startups and entrepreneurs, what these platforms offer is also increasingly being appreciated by investors.
NSE Plans to Join Action
“It’s critical we have more such platforms, because they can act as avenues for greater influx of seed capital in India, which is something that the entrepreneurial ecosystem severely lacks in India,” says Sunil Goyal, chief executive and fund manager of Your Nest Angel Fund, a Sebi-registered venture fund. “We believe this blends in well and supports the ecosystem. An increasing number of HNIs will invest in companies, either participating through funds or co-investing with them,” he added. While Venturefund.com has taken on a holistic approach towards building the entrepreneurial ecosystem, by educating and mentoring budding entrepreneurs, another platform, Venturesutra.com, has a much sharper focus — of just helping entrepreneurs raise funds.
“Our focus is really on qualifying the deal flow which reaches an investor. What we’ve done is tie up with over 60 investment houses across the country. With one click, an entrepreneur can send his business plan to the country’s leading investors,” says its founder, Abhijit Maheshwari. Venturesutra.com charges startups a fee of Rs 4,500 for its service, and has seen around 100 business plans uploaded so far.
Another platform recently launched in the country is TrepUp, positioned as a networking platform for companies and overseas investors keen on investing in Indian firms but don’t know how to.
TrepUp.com’s founder John Verbic, formerly with private equity fund, The Chatterjee Group, says he noticed a big opportunity in creating a platform that would help foreign investors invest in Indian companies. “Investors will pay an exponential multiple for opportunities in India, but the problem is, nobody in the West knows anybody here and vice-versa,” says Verbic, whose company acts a bridge between entrepreneurs and investors.Verbic does not charge a fee, but may do so once he reaches user critical mass. With various webbased platforms trying to find their niche and space in the entrepreneurial ecosystem, the National Stock Exchange (NSE) too plans to join the action.
It is planning to soon launch a web-based platform called ‘India Venture Board’, which will aim to be a bulletin board for startups and serve as a platform to bring them and investors together.
“It’s critical we have more such platforms, because they can act as avenues for greater influx of seed capital in India, which is something that the entrepreneurial ecosystem severely lacks in India,” says Sunil Goyal, chief executive and fund manager of Your Nest Angel Fund, a Sebi-registered venture fund. “We believe this blends in well and supports the ecosystem. An increasing number of HNIs will invest in companies, either participating through funds or co-investing with them,” he added. While Venturefund.com has taken on a holistic approach towards building the entrepreneurial ecosystem, by educating and mentoring budding entrepreneurs, another platform, Venturesutra.com, has a much sharper focus — of just helping entrepreneurs raise funds.
“Our focus is really on qualifying the deal flow which reaches an investor. What we’ve done is tie up with over 60 investment houses across the country. With one click, an entrepreneur can send his business plan to the country’s leading investors,” says its founder, Abhijit Maheshwari. Venturesutra.com charges startups a fee of Rs 4,500 for its service, and has seen around 100 business plans uploaded so far.
Another platform recently launched in the country is TrepUp, positioned as a networking platform for companies and overseas investors keen on investing in Indian firms but don’t know how to.
TrepUp.com’s founder John Verbic, formerly with private equity fund, The Chatterjee Group, says he noticed a big opportunity in creating a platform that would help foreign investors invest in Indian companies. “Investors will pay an exponential multiple for opportunities in India, but the problem is, nobody in the West knows anybody here and vice-versa,” says Verbic, whose company acts a bridge between entrepreneurs and investors.Verbic does not charge a fee, but may do so once he reaches user critical mass. With various webbased platforms trying to find their niche and space in the entrepreneurial ecosystem, the National Stock Exchange (NSE) too plans to join the action.
It is planning to soon launch a web-based platform called ‘India Venture Board’, which will aim to be a bulletin board for startups and serve as a platform to bring them and investors together.
BISWARUP
GOOPTU & SUDHIR SYAL ET120803
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