Processing .....please wait.. 
The article has been forwarded.... 
VC firms see growth in India, 8 stepped in this year
By siliconindia
New Delhi: The way to grow an economy is through entrepreneurship and capitalism, and India seems to have figured out the right formula. This is what atracts VCs to India. Eying the growing demand for early stage investment and increasing return, eight VC firms have entered the market this year, including Foundation Capital, SONG Investment Advisors, TLG Capital, Globespan Capital Partners and India Venture Partners, reports Shraddha Nair from the Mint.
"Venture investing is now emerging as a viable model," said Kanwaljit Singh, managing director, Helion Venture Partners. He adds that VC investment is no longer limited to IT start-ups. "That's why many of these funds that have been set up this year are domestic funds that understand the local market better."
Profitable exits are also boosting the business. VC firms in India sold stakes in 18 portfolio companies between January and August, some earning five-nine times returns on investment. There were 15 exits last year, and nine in 2008.
VC-backed firms such as One97 Communications, Just Dial, Cleartrip Travel Services and iYogi Technical Services have plans to list their shares. According to Suvir Sujan, Co-founder and Managing Director of Mumbai-based VC firm Nexus Venture Partners, there are plenty of early stage investment opportunity for VCs. "There are just five-six active VC funds in the country and the capital at work annually is just $200-500 million (
886-2,200 crore) across 50-70 deals," Sujan said.
As a result, VC firms that have invested in India from overseas offices are hiring local staff.
Oak Investment Partners, which invested in India from its U.S. office, hired Roy Rodrigues, former head of investment banking at Anand Rathi Securities, in August as an adviser. This followed Oak's purchase of a 73.95 percent stake in Tikona Digital Networks, along with some other investors, in March. "We're focused on providing growth capital in the range of $5 million to $50 million to promising growth companies in our sectors of expertise," said Rodrigues.
Slow recovery in the global VC industry is another reason why overseas investors are eyeing emerging markets such as India.
Assets under the management of VC firms worldwide rose steadily between 2003 and 2007. But unused capital reached peak levels in 2008 as a global economic slowdown set in and VC funds held back investments in the climate of uncertainty, says a report released this month by Preqin, a research firm focusing on alternative asset classes.
886-2,200 crore) across 50-70 deals," Sujan said.
As a result, VC firms that have invested in India from overseas offices are hiring local staff.
Oak Investment Partners, which invested in India from its U.S. office, hired Roy Rodrigues, former head of investment banking at Anand Rathi Securities, in August as an adviser. This followed Oak's purchase of a 73.95 percent stake in Tikona Digital Networks, along with some other investors, in March. "We're focused on providing growth capital in the range of $5 million to $50 million to promising growth companies in our sectors of expertise," said Rodrigues.
Slow recovery in the global VC industry is another reason why overseas investors are eyeing emerging markets such as India.
Assets under the management of VC firms worldwide rose steadily between 2003 and 2007. But unused capital reached peak levels in 2008 as a global economic slowdown set in and VC funds held back investments in the climate of uncertainty, says a report released this month by Preqin, a research firm focusing on alternative asset classes.
