US Based VC Fund To Heavily Invest in Indian Firms

US Based VC Fund To Heavily Invest in Indian Firms


New Enterprise Associates Inc. (NEA), an US-based venture capital (VC) fund will allocate 15%, or $375 million, for investment in Indian firms, a senior company official said.


Earlier, it had also raised $2.5 billion (Rs 11,425 crore) in its 13th fund to focus on the emerging markets.


Firm’s senior managing director told to media person that they will be only doing growth equity deals in India.

Moreover, they may enter early in some sectors and do follow-on funding till they reach $50 million.


Firm does have plans of investing funds in India over a period of four years, with a deal size of $30-80 million.


Though, their main focus will be the mid-market segment, all the way.

The new fund will also restructure its alliances in India.


NEA – IndoUS, started in 2006 by Vinod Dham, Vani Kola and Kumar Shiralagi, when NEA had no direct presence in India.


It raised $189 million in 2007 and has invested in firms such as mobile phone marketer mGinger, movie rental service Seventymm Services Pvt. Ltd, and online gift service Myntra Designs Pvt. Ltd.


The services sector and the clean technology space are among sectors the company will invest in.


The NEA fund also marks a revival of venture fund-raising.

The global financial meltdown that followed the September 2008 collapse of US investment bank Lehman Brothers Holdings Inc. dramatically affected the VC environment.


“Even funds with a good track record have found it difficult to raise money with many trying to raise funds since the past one year,” said Jagannadham Thunuguntla, equity head at Delhi-based investment bank SMC Capitals Ltd.


“It is not good news for first-time fund managers.

However, for the ones who have managed to raise money and invest in 2009-2010 they will get fair valuations and can at least expect modest returns” he added.



Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: