| Venture Capital |
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What is Venture Capital?
Venture Capital is the business of establishing an investment fund in the form of equity financing via investments in the
common stocks, preferred stocks and convertible debentures of various companies. These companies are seen to have a
high growth potential and are able to be listed on the stock
exchange in order to gain the highest returns in dividends and capital gain.
Venture Capital can be divided into many different types according to the characteristics of the shareholders and
sources of investment -- such as private equity firms, bands, financial institutions, private corporations, the government or
insurance companies.
This type of investment fund first began in the United States of America in 1970 with an emphasis on venture capital in either
new business enterprises that employed high technology of developing industries. After that, the criteria for choosing
suitable businesses to invest in expanded investment was possible in new businesses in their research and development
stages; or, businesses whose activities were in a state of expansion. Owing to the success of venture capital operations,
it soon extended in to other countries around the world, both in Europe and Asia. Today, more than $500,000 million is
circulating in this financial industry.
Venture Capital began in India in 1987 with just two
funds, one Thai and one Foreign. There has been a great increase in the number of firms and the amount of money
invested from those early days.
Continuous economic reforms since 1991 have made India an attractive destination for investment. Although the Asian markets are trying to reinvent themselves, there are clearly pockets of excellence upon which Venture capital can capitalize. India has a vast pool of entrepreneurial talent who are able to compete globally in a wide range of industries. A low cost labor base and a rapidly growing middle class add to the attractiveness of the Indian market as an investment opportunity.
To consolidate their position and become more competitive, Indian companies will need western business process expertise, access to capital and access to markets abroad. Few venture capitalists have a multiple presence in India, East Asia and America. Fewer still have the exposure and
experience in foreign markets to play a supportive role for Indian ventures in tapping these overseas markets.
The Andhra Pradesh Industrial Development Corporation (APIIC)is setting up a venture fund to assist the opening of information technology and
software units in the State. The fund -- Hyderabad Information Technology Venture Enterprise (HITVEL) -- is being set up in association with the SIDBI and the APIIC. The fund will become operational from May this year. HITEVL, with a corpus of around Rs. 15 crore, will supplement the efforts of APIDC to meet the immediate and future requirements of the IT companies coming in large numbers in the State. -- Mr. N. Yethiraja Rao, Chairman of APIDC.
Venture Capital inflows double to Rs. 1,400 crore and will grow faster. While the inflows into India have doubled in 1999 to Rs. 1,400
crore, they are expected to grow at a greater pace this calendar year to Rs. 3,200 crore, according to NASSCOM. In 1999 alone, 11 new venture
capital funds registered with SEBI, taking the total number to 19. In fact venture capital investment in high-tech firms in India has grown in leaps and bounds from Rs. 70 crore in 1996 to Rs. 1,400 crore in 1999.
NASSCOM expects this to grow further and touch Rs. 45,000 crore by 2008. Telecom Ventures to invest $ 50 million on Internet startups. This US company, formed on lines of a venture capital fund, plans to invest between $ 25-30 million in Internet startups in India offering education and connectivity solutions.
Addresses of a few Venture Capital Firms in INDIA
1.APIDC - Venture Capital Limited
1102, Block A, 11th floor, Babukhan Estate
Basheerbagh
Hyderabad 500 001
Tel. 040-599951/599952/597450
Fax 040-597449
E-mail apidcvcl@hd.1.vsnl.net.in
2.Canbank Venture Capital Fund Limited
11 floor, Kareem Towers, 19/5 & 19/6 Cunningham Road
Bangalore-560052
Tel.080-2264390/2260132
Fax 080-2251165
3.Draper International (I) Private Limited
203, Prestige Meridian- 1, MG Road, Bangalore-560001
Contact: Kiran S Nadkarni
Tel.080-5550325
Fax 080-5550461
E-mail:kran.nadkarni@draper.sprintrpg.ems.vsnl.net.in
4.Gujarat Venture Finance Limited
1 floor, Premchand House Annexe, Behind Popular House
Ashram Road, Ahmedabad-380 009
Tel. 079-6581285/6580704/6589985/6588741
Fax 079-6585226
E-mail vishnu@ad1.vsnl.net.in
5.IL&FS Venture Corporation Limited
5th floor, HDFC House, 51, Kasturba Road
Bangalore-560 001
Tel.080-2272950/2272951/2270068
Fax 080-2270418/2245564
E-mail mailto:ivc.bir@elnet.ems.vsnl.in
Regional Office:
4th floor, Mahindra Towers, Road No.13
GM Bhosle Marg, Worli, Mumbai-400 018
Tel. 022-4962411/4935127/4964353
Fax 022-4930080
6.Indus Venture Management Limited
Mafatlal Centre, 12th floor, Nariman point
Mumbai-400 021
Tel. 022-2024692/2852854
Fax 022-2842921
7.Industrial Development Bank of India
IDBI Tower, Cuffee Parade, Colaba
Mumbai-400 005
Tel. 022-2189111/2189117
Fax 022-2183619/2180411/2181294
E-mail mailto:VV.RAO@%20IDBI.CO.IN
Southern Zonal Office:
115, Anna Salai, Saidapet, PB N. 1306, Chennai-600 015
Contact : S. Suryanarayanan, Chief General Manager
Tel:-044-2355201-16
Fax 044-2355226
8.Industrial Venture Capital Limited
Vairams, 112, Thyagaraja Road, 4th floor
T Nagar, Chennai-600 017
Tel. 044-8233623/8284717/8283552
Fax 044-8255673
9.International Venture Capital Management Limited
Thapar Niketan, 7/4 Brunton Road, Bangalore-560 025
Contact: Donald Peck
Tel. 080-5550647/48/49
Fax 080-5550592
10.JF Electra Advisors (India ) Limited
Amerchand Mansion, 16 Madame Cama Road
Mumbai-400001
Tel.022-2835841/2
Fax 022-2883284
E-mail indiajfelectra@jfleming.com
11.Risk Capital and Technology Finance Corporation Ltd. Andhra Association Building, 4th floor, 24-25 Institutional Area Lodi Road, New Delhi-110 003
Tel. 011-4691790/4691791/4697611
Fax 011-4692295
12.Small Industries Development Bank of India
10/10, Madan Mohan Malviya Marg
Lucknow-226 001
Tel. 0522-209517-21
Fax 0522/209512/13/14
Southern regional office:
Temple Tower, 5 floor
476 Anna Salai, PB No 1312, Nandanam, Chennai-600 035
Contact: B Radhakrishnan, Chief General Manager
Tel.044-4330286/4330964/4330062
Fax 044-4340348
Western Regional office:
15th floor, Hoechst house
Nariman Point, Mumbai-400 021
Contact: P R Das Chief General Manager
Tel. -22-2872475/2881273
Fax 022-2872490
13.TDICI Limited
Raheja Plaza, 4th floor, 17 Commissariat Road
D'Souza Circle, Bangalore-580 025
Tel. 080-5583681/5584471/2/3
Fax 080-5580741
E-mail tdici@giasbg01.vsnl.net.in
Regional office:
Ground Floor, Scindia House, N M Marg, Ballard Estate
Mumbai-400 038
Contact: Sunil Vasand Diwakar, Asst. Vice President
Tel. 022-2664767
Fax 022-2664769
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