I never quite expected Rajesh Subramaniam, the former CFO of business process outsourcing company Firstsource Solutions, to turn up in the venture capital business. Known within Firstsource as the M&A specialist, he definitely lived up to the tag — seven acquisitions in almost as many years and the last one a whopper — the $330 million acquisition of US healthcare insurance services company MedAssist. Subsequently there has been talk that Firstsource itself has become an acquisition target but all of this is still speculation.
With his track record, Subramaniam would be any top notch private equity firm’s pick. Maybe he doesn’t like private equity that much. But even if his interest leaned towards venture capital, why Walden looked more interesting than others is not so clear. The San Francisco-headquartered, technology focused firm has well-established global credentials and was one of the earliest US venture capital firms to see the cross-border investing opportunity in emerging markets. Except that while most cross-border investors focus on one or two countries — say US-India or US-China — Walden went into China, India, Singapore, Malaysia and Taiwan (also Israel). And this was a strategy it had worked out in 1987. But the firm has not had such a happy outing in India.
Subramaniam’s appointment marks Walden’s re-entry in India after about five years — the one notable investment from the past is MindTree. The firm seems to have set up an office of sorts in Bangalore on Brunton Road, in the same building (same floor) that houses Silicon Valley Bank. There is no mention of Subramaniam joining the firm anywhere on the website, so I’ll go with the Business Line report for now. He is also the firm’s third India chief after Sudhir Sethi and Dinesh Vaswani. Sethi led investments here for four years till April 2002. He now heads IDG Ventures India. Vaswani moved from Walden’s US offices in 2002 to replace Sethi but he quit in about two years to join Bessemer Venture Partners. He is now a managing director with Temasek Holdings.
Since Vaswani’s exit Walden has not had any sort of presence in India, which is unfortunate because 2004 onwards, India’s venture capital market exploded. And despite having an early mover advantage in India, the absence in the last five-odd years could cost. Newer and later entrants have built strong reputations and, importantly, have pretty robust networks on the ground. Walden, ironically, will be the new entrant in this phase of venture investing in India.