Clearstone mulls closing 2 investment deals

BANGALORE: US-based venture capital firm Clearstone Venture Partners is looking to close about two investments by the year-end. The VC firm which set up a subsidiary Clearstone Venture Advisors in India in August last year, has made three deals in the country so far.

“We are having ongoing discussions with three-four companies at a time and expect to close at least two deals by end of 2007. The companies we are looking at are tech-driven businesses in financial services, communications, content & entertainment segments,” said Mr Sumant Mandal, managing director, Clearstone Venture Partners.

While Clearstone’s average investment per company in India so far has been about $5 million, the VC firm is currently talking to a financial services player to make a large VC investment upto $20 million. While declining specifics, Mr Mandal said the deal may be closed this year.

In the financial services sector, the firm is looking at varied opportunities in distribution of financial products, insurance and savings, payments and other services.

Clearstone’s first investment in India was when it invested $5 million in Iindiaideas.com, a provider of payment services which operates as Billdesk in June 2006. The second deal was an investment of $5 million in Bangalore-based mobile handset solutions firm DigiBee Microsystems in January 2007 while its most recent was putting in about $5 million in Games2win India in March. These investments came from the VC firm’s third fund of $200 million.

Mr Rahul Khanna, director, Clearstone Venture Advisors, said that about 70% of the third fund has been used globally and the investment cycle could be completed by early 2008. Clearstone has total committed capital of $650 million across three funds. Its earlier global investee companies include eToys, Overture, PayPal, United Online and MP3.com. tanuja.badimala@timesgroup .com