Archive for August 2007

Delhi Journal

I’m working on tour again after a full six months and it’s a good feeling. And I’m back in Delhi, which is not so nice. Agenda: catch up with the private equity shops based here. There are quite a few heavyweight ones — ChrysCapital, Citigroup Venture Capital, Henderson Equity Partners, Actis, Providence Equity Partners, DE Shaw (that’s a hedge fund doing private equity here) and Baring Private Equity India. A couple of venture capital outfits also invest out of the city, Gurgaon to be accurate — Canaan Partners and one arm of Helion Venture Partners.

For me, the Oberoi, some 15 minutes from Connaught Place, symbolizes private equity in Delhi. ChrysCapital, the country’s largest firm, by funds under management, works out of the hotel. Right next to it is Henderson is an older occupant. When you step out of the elevator into the corridor outside their offices, the character of the place hits you immediately — plush, discreet and very very RICH. The very distinct character continues into ChrysCapital’s offices, double doors right end of the corridor.

My favourite private equity firm in Delhi, however, is Actis. It used to be headquartered in the city, until recently — their office is near the golf course. I’ve never been there but the firm’s former India chief, Donald Peck, has always been great to talk to. Peck has moved on to a larger, regional role and JM Trivedi, who works out of Mumbai, now leads the firm’s India investments.

Tomorrow I’m off to Gurgaon to catch up with Sanjeev Aggarwal at Helion and Alok Mittal at Canaan. I’m also hoping to drop into one or two of the many malls there — they don’t make shopping malls like that anywhere else.

Monday Musings

Sequoia Capital India picked up former Sify CEO and co-founder R Ramaraj as senior advisor over the weekend. That’s two Sify scalps after George Zacharias, former Sify COO and then Yahoo! India chief, got $20 million funding for his start-up (yet to be unveiled) from Sequoia. So will Ramraj be advising Zacharias?

Sequoia (which was WestBridge Capital Partners till last year) itself is back in the early-stage funding space with a vengeance. It has just lauched a $300 million fund and the fund’s co-founders, KP Balaraj and Sumir Chadha, are quite determined to get their VC tag back. The firm has always done interesting deals and it will be well worth watching their moves in the next few months.

When Citigroup does decide who it wants to sell its BPO to — the latest names are Genpact and Firstsource — someone please wake me up…the suspense is not interesting anymore.

Suhel Seth has put money behind a YouTube clone called TheBig.tv. Congratulations to entrepreneur Alankar Jain (he’s from NDTV) and no offence to start-ups, but I’m beginning to believe that India is just good at making first copies of the original. Too many me-toos, too often, in the Internet space.

Camp Update

September is brimming over with BarCamps (and variations) cross-country. Browse below:

  • OSS Camp Delhi — September 8th and 9th — Registrations are open, the venue is Impetus Infotech at Sector 59 in Noida and among outstation campers already registered for the event, there are two guys from the US and one from Bangladesh!
  • MySQL Camp Mumbai – September 29th — This one is at Hiranandani Gardens in Powai. I don’t know much about MySQL but I’m just happy to see Mumbai unconferencing on something.
  • BarCampMU3 — September 29th. This one’s for students and is at KJ Somaiya in Sion.
  • TiE-ISB Connect — NEA-IndoUS Ventures has a business plan showcase at the event, which is on 14th-16th November. The last for registering for the showcase is August 31st.

Bangalore Has an OpenCoffee Club

So there’s a Bangalore Open CoffeeClub as well. It debuted on August 19 at BrewHaHa, the coffee shop that’s more than a coffee shop at Koramangala. Again, OpenCoffee Club or OCC is a global unconference movement that originated in London. It was founded by entrepreneur and early-stage investor Saul Klein who among many things has been vice president, ecommerce, at Skype. Read more about him at his blog.

For more on the Bangalore OCC, read a detailed post on the event and its participants on Himanshu Sheth’s blog here.

Also bumped into an interesting blog called Technofriends — it makes technology simple for simple people, like me. Thanks Vaibhav (Pandey) for linking me up to it.

Uneasy Legacy

Last week ChrysCapital, some of you may remember them as Chrysalis Capital from another time, raised a $1.25 billion fund, its fifth so far (the last one had a $550 million corpus and was raised just over a year ago). This is the largest private equity fund raised for India till date and that too by a homegrown firm. Quite a feat for a firm that started out just eight years ago with a $64 million fund.

The reason I like ChrysCapital is because of its startup origins. Two college buddies at Harvard Business School, Ashish Dhawan and Raj Kondur, thought it would be cool to replicate the Silicon Valley venture capital model in India. The plan was to invest in the hot new thing — Internet start-ups. They sold the idea to a bunch of investors in the US, including HBS, and came back to Mumbai to launch their first fund.

The idea flopped. The Internet bust wiped out most of their investments and what could have been the country’s first Silicon Valley-style venture capital firm never took off. The two friends also parted ways, not so happily. Kondur retreated to his home base in Bangalore and emerged a few years later with yet another entrepreneurial venture — a BPO company called Nirvana Business Solutions. When I met him last, about two years ago, he was brimming over with excitement. Last I checked, Nirvana is humming along quite happily.

Dhawan also retreated to home base in Delhi and took ChrysCapital with him. And as most prudent startups do, the firm changed its business model — the country’s first standalone private equity firm was born. The rest, of course, is history. When I asked him a year ago whether he ever stopped to think about the old days, he said, “Sure, it was fun while it lasted. But we made mistakes, we didn’t know how to do a lot of things.”

I suppose it was too long ago to wonder whether the two friends who named their start-up after a college fest are still in touch. Their legacy, though, will always bind them together. After all, one small idea practically seeded a multi-billion dollar private equity market, one that even Wall Street’s big boys cannot afford to ignore anymore.

Image Courtesy: ChrysCapital

Vineet Buch on why VCs need startup experience

I meant to post this a while back, a couple of months ago actually, but got side-tracked. While trawling the Internet for blogs by venture capitalists I came across one called Venture Explorer. It is the personal weblog of a venture capitalist called Vineet Buch. He’s a principal with BlueRun Ventures in Menlo Park, California. I tracked him down through his blog and he agreed to an interview. It is one of the most candid interviews that I’ve been given by a venture capitalists. Here are some of the thoughts he shared with me:

On being an entrepreneur-turned-VC

VCs who have been entrepreneurs often find it hard to give up control. (Buch founded two companies, Karient and Riya, before turning venture capitalist two years ago).

On how much a startup background helps

It is important to have some experience in working with a start-up to be a VC. You can’t really understand the problems and dynamics of a start-up if you’ve only worked in a big corporation.

On local search startups in India

Lots of people are trying to do local search here. The question is: how do you scale that? If you try to monetize local search through advertising, how will you get a dosa vendor in Andheri to advertise? (He thinks the hybrid online-offline model works better in India).

Buch focuses on early-stage consumer Internet, enterprise software, mobile services and clean energy companies in the Valley. He grew up in Bhopal and Delhi and is often in India to look at prospective investments here. You must visit his blog to find out about his off-work persona. This guy is a complete outdoors person — he backpacks, snowshoes, sea kayaks and more. “I love to explore, as much of the earth there is left to explore. I must have been born in the wrong era,” he says.

Image Courtesy: BlueRun Ventures