Kerala is poised for a far stronger startup ecosystem, as four investment funds have opened the possibilities of more than Rs 1,000 crore for new business ventures in the next four years, a top official said today.
Unicorn India Ventures, Exseed Electron Fund, Indian Angel Network and Speciale Incept Fund are the financial entities the government has selected in response to a tender floated recently, according to Mr M Sivasankar, Secretary, Kerala Electronics and IT Department.
Since the pact mandates investing 25 per cent of the volunteered amount in the next four years, the state is guaranteed with a minimum investment of Rs 300 crore by 2022 fiscal, he revealed on the sidelines of ‘Seeding Kerala’. The fourth edition of the event, organised here by Kerala Startup Mision (KSUM) in association with investment platform LetsVenture, brought together the state’s HNIs in a bid to provide them opportunities to invest in potentially rewarding startups.
Mr Sivasankar, addressing a media conference, pointed out that the Kerala government has adopted the Fund of Funds model to invigorate angel and VC funds, thus facilitating holding of a portfolio than of other investment funds rather than investing directly in stocks, bonds and other securities. The state, on its parts, provides an annual investment of Rs 15 crore.
The first leg of 2017-launched ‘Seeding Kerala’ saw encouraging results, prompting the government to aim at raising investments worth Rs 60 crore. How much high amount angel and VC funds could raise from this amount was the yardstick for their selection, the IT Secretary informed. The state got 34 Expressions of Interest, from which four funds were invited to the KSUM endeavour on developing the state’s startup ecosystem, he added.
Among the four, Exseed will invest solely in startups based in the fields of space and IT, Mr Sivasankar said. The state will also encourage funds for startups working in the sectors of cancer treatment and disaster management, he added.
KSUM CEO Dr Saji Gopinath said the selection of the four funds would help the state tide over its problem of insufficient funds. Startups anyway required decentralised operations, he added.
The first two editions (both in 2017) of ‘Seeding Kerala’ strove to introduce angel investors from outside of Kerala to the state. Into the third, the focus turned to HNIs within Kerala and linking them with startups that merited investment.
Today’s conference provided delegates masterclass on angel investing, while giving them a clearer idea on investment and portfolio diversification. The day-long sessions also discussed the legal aspects of investing and took up case studies of Remarkable business in the state.
Kerala State Industrial Development Corporation Chairman Christy Fernandez and Indian Angel Network’s Padmaja Ruparel, besides investors Dr Ritesh Malik and Anil Joshi were among the speakers who led the conference.