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Venture Capital in India
Presented to:- Pro. Vipin Garg.
Presented By:- Ramandeep Kaur,
Roll No.:- 304,
MBA (IC) 10th Sem.
Venture capital (VC) is financial capital provided to
early-stage, high-potential, high risk, growth start up
companies. VC funds made available for startup firms
and small businesses with exceptional growth
potential. Managerial and technical expertise are
often also provided, also called risk capital.
Venture Capital
Venture capital financing is typically referring to the
money received, or the act of receiving money from a
venture capital fund for use in the operations of a
start up or growing company. While some venture
capital financing agreements may be loans, it is most
common for venture capital financing to also involve
a transfer of some business equity.
Venture Capital Financing: Meaning
Early stage financing
1. Seed capital/ pre-start up
2. Start up
3. Second round financing
Later stage financing
1. Mezzanine/ Development capital
2. Bridge/ Expansion
3. Buyouts
I. Management Buyouts
II. Management buy ins
Turnarounds
Stages of Venture capital financing
Equity
Conditional loan
Income notes
Participating debentures
Quasi equity
Methods of Venture Financing
The concept of venture capital was formally
introduced in India in 1987 by IDBI.
ICICI started VC activity in the same year
Later on ICICI floated a separate VC company - TDICI
DEVELPOMENT OF VENTURE
CAPITAL IN INDIA
VCFs in India can be categorized into following five
groups:
1) Those promoted by the Central Government
controlled development finance institutions. For
example:
- ICICI Venture Funds Ltd.(1988)
- IFCI Venture Capital Funds Ltd (IVCF) (1975)
- SIDBI Venture Capital Ltd (SVCL) (1999)
Venture capital funds in India
2) Those promoted by State Government controlled
development finance institutions.
For example:
- Punjab Infotech Venture Fund
- Gujarat Venture Finance Ltd (GVFL) (1990)
- Kerala Venture Capital Fund Pvt. Ltd.(1993)
3) Those promoted by public banks.
For example:
- Canbank Venture Capital Fund (1989)
- SBI Capital Market Ltd (1986)
Continue…………
4)Those promoted by private sector
companies.
For example:
- IL&FS Trust Company Ltd (1995)
- Infinity Venture India Fund
5)Those established as an overseas venture capital
fund.
For example:
- Walden International Investment Group
- HSBC Private Equity (1853)
Continue…………
 It was established in 1993 and is based in Delhi, the
capital of India
 It is a member based national organization that
- represents venture capital and private equity firms
- promotes the industry within India and throughout
the world
- encourages investment in high growth companies
and
- supports entrepreneurial activity and innovation.
Indian Venture Capital and Private
Equity Association (IVCA)
IVCA members comprise venture capital
firms, institutional investors, banks, incubators, angel
groups, corporate
advisors, accountants, lawyers, government
bodies, academic institutions and other service
providers to the venture capital and private equity
industry.
Members represent most of the active venture capital
and private equity firms in India. These firms provide
capital for seed ventures, early stage companies and
later stage expansion.
Continue……………
VC can help in the rehabilitation of sick units.
VC can assist small ancillary units to upgrade their
technologies
VCFs can play a significant role in developing
countries in the service sector including tourism,
publishing, health care etc.
They can provide financial assistance to people
coming out of universities, technical institutes, etc.
thus promoting entrepreneurial spirits
Future prospects of VC in India
Venture capital investments down by 30% to $762
million across 206 deals in 2012, but in 2011 VCs
invested $1094 million spread across 222 deals.
Investments in IT companies led the deal table
accounting for $381 million across 133 deals last year,
but dropped from $558 million in 2011.
The value of deals in health care and life sciences
dipped to $98 million from $120million.
Venture Capital Financing in India
(2012)
E-commerce saw 31 PE and VC deals in 2012
translating into $298 million compared to 36 PE/VC
deals worth $328 million in 2011.
Group-buying sites that raised $66 million across four
deals in 2011, did not see a single round of fund-raising
in 2012.
Continue…………
SIDBI Venture Capital to invest Rs.150 cr in small and
medium enterprises in next 3-4 months
Investors commit over Rs 400 crore for funding new
ventures for the poor
Canbank Venture Capital invests in Guwahati hospital
Venture Capital Financing in India
(2013)
Of the first disbursement (by the government) of
Rs.500 crore, we have already committed Rs.350
crore," SIDBI Chairman and Managing Director S
Muhnot said.
Remaining Rs.150 crore would be utilized in the next
3-4 months
Meanwhile, SIDBI has signed a memorandum of
understanding with Social Fund of Development of
Egypt to undertake SME sector development projects
in that country.
SIDBI Venture Capital to invest Rs.150 cr
in small and medium enterprises in next
3-4 months
Investors have committed at least Rs 400 crore to a
government-backed fund that will provide capital to
new ventures serving the needs of India's low-income
communities.
The fund, whose eventual size is envisaged at more
than Rs 5,000 crore, is the first such by the
government, which is taking increasing interest in
venture capital investing.
Investors commit over Rs 400 crore for
funding new ventures for the poor
The investment now raised as venture finance from
Emerging India Growth Fund, a Rs 500-crore fund
managed by Canbank Venture is being used to part
finance the setting up of a 300-bedded Super Specialty
Hospital at north Guwahati, Assam, and for
modernization, up gradation, expansion of existing
facilities.
Canbank Venture Capital invests in
Guwahati hospital
Venture capital in india
Venture capital in india

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Venture capital in india

  • 1. Venture Capital in India Presented to:- Pro. Vipin Garg. Presented By:- Ramandeep Kaur, Roll No.:- 304, MBA (IC) 10th Sem.
  • 2. Venture capital (VC) is financial capital provided to early-stage, high-potential, high risk, growth start up companies. VC funds made available for startup firms and small businesses with exceptional growth potential. Managerial and technical expertise are often also provided, also called risk capital. Venture Capital
  • 3. Venture capital financing is typically referring to the money received, or the act of receiving money from a venture capital fund for use in the operations of a start up or growing company. While some venture capital financing agreements may be loans, it is most common for venture capital financing to also involve a transfer of some business equity. Venture Capital Financing: Meaning
  • 4. Early stage financing 1. Seed capital/ pre-start up 2. Start up 3. Second round financing Later stage financing 1. Mezzanine/ Development capital 2. Bridge/ Expansion 3. Buyouts I. Management Buyouts II. Management buy ins Turnarounds Stages of Venture capital financing
  • 5. Equity Conditional loan Income notes Participating debentures Quasi equity Methods of Venture Financing
  • 6. The concept of venture capital was formally introduced in India in 1987 by IDBI. ICICI started VC activity in the same year Later on ICICI floated a separate VC company - TDICI DEVELPOMENT OF VENTURE CAPITAL IN INDIA
  • 7. VCFs in India can be categorized into following five groups: 1) Those promoted by the Central Government controlled development finance institutions. For example: - ICICI Venture Funds Ltd.(1988) - IFCI Venture Capital Funds Ltd (IVCF) (1975) - SIDBI Venture Capital Ltd (SVCL) (1999) Venture capital funds in India
  • 8. 2) Those promoted by State Government controlled development finance institutions. For example: - Punjab Infotech Venture Fund - Gujarat Venture Finance Ltd (GVFL) (1990) - Kerala Venture Capital Fund Pvt. Ltd.(1993) 3) Those promoted by public banks. For example: - Canbank Venture Capital Fund (1989) - SBI Capital Market Ltd (1986) Continue…………
  • 9. 4)Those promoted by private sector companies. For example: - IL&FS Trust Company Ltd (1995) - Infinity Venture India Fund 5)Those established as an overseas venture capital fund. For example: - Walden International Investment Group - HSBC Private Equity (1853) Continue…………
  • 10.  It was established in 1993 and is based in Delhi, the capital of India  It is a member based national organization that - represents venture capital and private equity firms - promotes the industry within India and throughout the world - encourages investment in high growth companies and - supports entrepreneurial activity and innovation. Indian Venture Capital and Private Equity Association (IVCA)
  • 11. IVCA members comprise venture capital firms, institutional investors, banks, incubators, angel groups, corporate advisors, accountants, lawyers, government bodies, academic institutions and other service providers to the venture capital and private equity industry. Members represent most of the active venture capital and private equity firms in India. These firms provide capital for seed ventures, early stage companies and later stage expansion. Continue……………
  • 12. VC can help in the rehabilitation of sick units. VC can assist small ancillary units to upgrade their technologies VCFs can play a significant role in developing countries in the service sector including tourism, publishing, health care etc. They can provide financial assistance to people coming out of universities, technical institutes, etc. thus promoting entrepreneurial spirits Future prospects of VC in India
  • 13. Venture capital investments down by 30% to $762 million across 206 deals in 2012, but in 2011 VCs invested $1094 million spread across 222 deals. Investments in IT companies led the deal table accounting for $381 million across 133 deals last year, but dropped from $558 million in 2011. The value of deals in health care and life sciences dipped to $98 million from $120million. Venture Capital Financing in India (2012)
  • 14. E-commerce saw 31 PE and VC deals in 2012 translating into $298 million compared to 36 PE/VC deals worth $328 million in 2011. Group-buying sites that raised $66 million across four deals in 2011, did not see a single round of fund-raising in 2012. Continue…………
  • 15. SIDBI Venture Capital to invest Rs.150 cr in small and medium enterprises in next 3-4 months Investors commit over Rs 400 crore for funding new ventures for the poor Canbank Venture Capital invests in Guwahati hospital Venture Capital Financing in India (2013)
  • 16. Of the first disbursement (by the government) of Rs.500 crore, we have already committed Rs.350 crore," SIDBI Chairman and Managing Director S Muhnot said. Remaining Rs.150 crore would be utilized in the next 3-4 months Meanwhile, SIDBI has signed a memorandum of understanding with Social Fund of Development of Egypt to undertake SME sector development projects in that country. SIDBI Venture Capital to invest Rs.150 cr in small and medium enterprises in next 3-4 months
  • 17. Investors have committed at least Rs 400 crore to a government-backed fund that will provide capital to new ventures serving the needs of India's low-income communities. The fund, whose eventual size is envisaged at more than Rs 5,000 crore, is the first such by the government, which is taking increasing interest in venture capital investing. Investors commit over Rs 400 crore for funding new ventures for the poor
  • 18. The investment now raised as venture finance from Emerging India Growth Fund, a Rs 500-crore fund managed by Canbank Venture is being used to part finance the setting up of a 300-bedded Super Specialty Hospital at north Guwahati, Assam, and for modernization, up gradation, expansion of existing facilities. Canbank Venture Capital invests in Guwahati hospital