VC funds to globalise further
%. Venture capital-backed companies, however, would still be a small proportion of country’s GDP.
| Sanjeev Aggarwal Managing Director Helion Ventures | |
Venture capital is a fledgling industry today and I do not expect that to change materially in 2008. It is an industry which contributed less than $1 billion in the year gone by.
Given the fact that it is coming off such a small base, it will not be surprising if it grows by 50%. Venture capital-backed companies, however, would still be a small proportion of country’s GDP.
This industry has seen a large influx of capital from one of the world’s most sophisticated investors, the ivy league universities. They will continue to increase their allocation to venture capital, especially in emerging markets like India. The Indian venture capital industry that has so far been largely funded by the US will see an influx of funds from Europe and Asia in this year.
As companies globalise to look for new markets and build efficient supply chains, venture capital will continue to globalise even further. Venture firms originating from mature economies like the US will set up or strengthen their operations in India.
Indian VC firms, especially the ones that invest in technology, would do the converse. VC firms will also strengthen their teams by aggressively inducting entrepreneurs/operating executives in their ranks to provide mentorship to their portfolio companies.
From a sectoral standpoint, 2008 will be a year of continuity and of change. More money will continue to flow into the erstwhile popular sectors like, internet services, mobile value-added services, technology products and KPO.
Given that the Indian economy is growing on many fronts, I see venture capital getting allocated to education, consumer services and financial sector. Companies that serve the consumer, sell services, build capital efficient and asset light businesses will be in special demand with VCs.
We saw an early trend of professionals turning entrepreneurs in 2007. Helion itself funded two companies, Gridstone Research and Anantara that were breakout groups from Infosys and Satyam respectively. Given the downswing in IT stocks, I see acceleration in number of professionals coming out of reputed technology firms to start their own ventures.
Finally, the quality and quantum of entrepreneurial teams that build businesses with venture capital will attain new heights. In Helion’s first full year of operations, we received over 500 proposals! The trajectory of deal flow will continue to be very positive, given the pent up desire for entrepreneurship. It promises to be a year where deal flow and capital supply will be well matched!
Given the fact that it is coming off such a small base, it will not be surprising if it grows by 50%. Venture capital-backed companies, however, would still be a small proportion of country’s GDP.
This industry has seen a large influx of capital from one of the world’s most sophisticated investors, the ivy league universities. They will continue to increase their allocation to venture capital, especially in emerging markets like India. The Indian venture capital industry that has so far been largely funded by the US will see an influx of funds from Europe and Asia in this year.
As companies globalise to look for new markets and build efficient supply chains, venture capital will continue to globalise even further. Venture firms originating from mature economies like the US will set up or strengthen their operations in India.
Indian VC firms, especially the ones that invest in technology, would do the converse. VC firms will also strengthen their teams by aggressively inducting entrepreneurs/operating executives in their ranks to provide mentorship to their portfolio companies.
From a sectoral standpoint, 2008 will be a year of continuity and of change. More money will continue to flow into the erstwhile popular sectors like, internet services, mobile value-added services, technology products and KPO.
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Given that the Indian economy is growing on many fronts, I see venture capital getting allocated to education, consumer services and financial sector. Companies that serve the consumer, sell services, build capital efficient and asset light businesses will be in special demand with VCs.
We saw an early trend of professionals turning entrepreneurs in 2007. Helion itself funded two companies, Gridstone Research and Anantara that were breakout groups from Infosys and Satyam respectively. Given the downswing in IT stocks, I see acceleration in number of professionals coming out of reputed technology firms to start their own ventures.
Finally, the quality and quantum of entrepreneurial teams that build businesses with venture capital will attain new heights. In Helion’s first full year of operations, we received over 500 proposals! The trajectory of deal flow will continue to be very positive, given the pent up desire for entrepreneurship. It promises to be a year where deal flow and capital supply will be well matched!
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