Google Inc will invest up to Rs 22.5 crore (around $5.5-million) in Ventureast TeNet Fund-II, a seed-stage fund that will invest in technology companies.
Ventureast TeNet Fund-II will invest in technology start-ups
MUMBAI: Google Inc will invest up to Rs 22.5 crore (around $5.5-million) in Ventureast TeNet Fund-II, a seed-stage fund that will invest in technology companies trying to establish their foothold.
The fund is promoted by the Tenet Group of Chennai IIT and Hyderabad-based Ventureast Fund Advisors.
“Google has invested Rs 15 crore in this fund so far and is expected to put in the remaining amount by March 2008, when the fund is scheduled to close,” Ventureast’s managing general partner, Sarath Naru, said.
Google’s investment in the fund will then be 30% and the remaining will be held by other investors, including SIDBI and Technology Development Board. Ventureast TeNet Fund has a total size of $18.75 million (about Rs 75 crore).
Seed-stage funds, as the name suggests, invest in early-stage companies, plying in technology-based sectors such as IT, renewable energy and bio-technology.
Google made its debut as an investor in venture capital funds in January this year, when it invested nearly $3.75 million in a domestic seed investment firm “Seedfund”, which has a total size of $13 million (Rs 52 crore).
This was followed by an undisclosed investment in the Bangalore-based early stage venture fund — Erasmic Venture Fund, which has a size of around $10 million.
Google’s head of corporate development (South Asia), Samir Sood, was not available for comment.
Google’s Indian fund investments are learnt to be the first venture fund investment of the US Internet search engine firm, which has clocked a $4.23 billion revenue in the quarter ended September 30.
Google, which has largely been seen interested in investing in high-end technology-related ventures, is likely to come up with more investments in Indian venture funds in future, according to industry sources.
VentureEast TeNet II fund is focused on technologies and solutions to the SME sector and in bridging the digital divide in the Indian system, Naru said.
“This will help fund-starved SMEs in the country. We will be coming with one more fund in March next, which will have a total fund size of $150 million. Some of the PE firms have approached us to invest in this fund,” Naru said.
However, he declined to reveal their identities.
Google, as a part of its strategy to enhance its presence in the Indian sub-continent, had recently come up with “Google SMS” for Indian mobile users — a messaging service that enables the user to avail information without an Internet connection.
Google has also recently joined the Indian Angel Network, an organisation that supports entrepreneurship in the country.
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