A PRESENTATION ON WORKING OF VENTURE CAPITAL IN INDIA

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SUBMITTED BY: Jankhana Joshi Chandni Pandya Megha Shah Khushbu Parekh Shilpa Parmar
5/6/12

Introduction of venture capital

Venture capital provides long-term, committed share capital, to help unquoted companies grow and succeed. If an entrepreneur is looking to start-up, expand, buy-into a business, buy-out a business in which he works, turnaround or revitalize a company
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Venture capitalists typically assist at four stages in the company's development:

Idea generation; up; and

Start-up; Ramp Exit

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FINANCIAL STAGES OF VENTURE CAPITAL

Seed

Money: Low level financing needed to prove a new idea. Early stage firms that need funding for expenses associated with marketing and product development. Early sales and manufacturing funds

Start-up:

First-Round:

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FINANCIAL STAGES OF VENTURE CAPITAL

Second-Round:

for early stage companies that are selling product, but not yet turning a profit this is expansion money for a newly profitable company 4th round is intended to finance the "going public" process
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Third-Round:,

Fourth-Round:

Practical examples of venture capital

Example

1: Sandstone, Sequoia, Madison Invest Rs 200 Cr in Micromax Capital is a private equity and venture capital firm specializing in incubation, seed stage, start-up stage, early stage, and growth stage investments in private companies.
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Sequoia

Sandstone

Capital, LLC is a privately owned hedge fund sponsor. The firm primarily provides its services to university endowments, public and private foundations, family offices, individual investors, and other institutions. It invests in public equity and hedging markets of India and the subcontinent. India Capital focuses on investment opportunities Indian media, communications and business services.

Madison

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About

Micromax:

The company has sold minority stake to three investors Sequoia Capital, Sandstone Capital and Madison Capital Management, valuing the group to more than 440 million dollars.

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Example 2: IDG venture invests $3mn in online fashion retailer-eshakti.com

About IDG Venture Capital: Ventures investment portfolio includes Apalya Technologies, Myntra Designs, iProf Learning, Sourcebits Technologies Pvt Ltd, Agile Financial and 3D Solid Compression Pvt. Ltd. Most recently, IDG Ventures invested $3Mn in Mobile Ad Network firm Vserv Digital Services. Ventures has invested $3Mn in online fashion retailer - eShakti.com Pvt Ltd for a minority stake.

IDG

IDG

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About Online Fashion Retailer:

Mumbai:

Early-stage venture capital firm IDG Ventures India has invested $3 million in eShakti.com Pvt. Ltd, an online Western fashion retailer in the US, for a minority stake. eShakti, which makes customized, designer clothes for women, started exports to the US in 2008. It plans to use the moneyto scale up operations, add new product lines and also cater to Indian consumers.

Chennai-based

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Example 3: Nexus, Lightspeed Invest In Handicraft Portal-Craftsvilla.com

About

Nexus:

Nexus are India's leading Venture Capital fund. It invest in early and early growth stage companies across sectors. There partner companies have access to the entire Nexus team in India and Silicon Valley for help in recruiting talent, forging new alliances, opening doors to new customers, shaping the strategy and connecting with best of breed advisors or board members.

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About Lightspeed:
Lightspeed

manages over $2 billion of committed capital and invests across the U.S., China, India, and Israel. We are currently investing out of Lightspeed VIII, an $800 million fund raised in early 2008. Handicraft Portal:

About

Handicraft and natural product e-commerce portal - craftsvilla.com has raised early stage funding from Nexus Venture Partners and Lightspeed Venture Partners. The company will use the funds to expand operations within India as well as overseas in the US, the UK, Germany and Japan.
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 About

Handicraft Portal:

Handicraft

and natural product e-commerce portal - craftsvilla.com has raised early stage funding from Nexus Venture Partners and Lightspeed Venture Partners. The company will use the funds to expand operations within India as well as overseas in the US, the UK, Germany and Japan.

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Example 4: Intel Capital Announces Investments in Six Tech Startups

About

Intel Capital:

At Intel Capital, they only succeed there portfolio of companies succeeds. Thats why we do everything we can to ensure a positive return. We lead the majority of investments, participate on boards, and collaborate with the investment community at large. Portfolio companies of Intel include Noida-based Wortal Technologies that runs local events portal BuzzInTown, Pune-based Persistent Systems, Infrasoft Technologies and KLG Systel.
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 About Intel Six

Six Tech:

Capital is investing $20Mn in six tech companies in India. tech company want investment at initial base, so the Intel company is investing at the early stage in Six Tech company. Tech Company is an software company.

Six

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Thank you.

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