Sistema Asia Fund
(SAF), a proprietary venture capital fund of Russian conglomerate Sistema JSFC, is planning to increase the corpus of its fund to $120 million, from $50 million, by roping in other investors.
This will allow the fund to cut bigger cheques for Series-B deals in India, said Dhruv Kapoor, managing director, Insitel Services, which advises the fund. Registered in Singapore, the fund has applied for a licence to rope in third-party LPs or limited partners.
Limited partners are big investors like pension funds, big family offices who invest in private equity funds.
Currently, the fund invests $2-5 million in Series-B rounds of funding
of start-ups. ‘‘If we need to operate as a sustainable fund, we need to get to a reasonable size. We think a size of $120 million gives us the runway to do the kind of deals we are getting,” says Kapoor.
SAF started as a proprietary fund in end-2015, and Kapoor says it needs to make a progression to right-sized funds to participate in the quality of deals it is getting across sectors. A $50-million corpus could be a constraint, though the fund has not yet deploy even half of it.
The fund has invested in five start-ups — Seclore, Qwikcilver, Wooplr, Licious and Mobikon
(see table), helping these companies getting between $7 million and $12 million in Series-B funding
with other investors such as Helion Advisors, Amazon, Accel, Mayfield, among others.
While the fund makes Series-B funding
and is sector-agnostic, it is open to look at Series-A and Series-C funding
opportunity. SAF will initially focus on India and then look at start-ups from Southeast Asia.
It has a four-member investment team, which it wants to expand. SAF is being advised by Insitel Services, a wholly-owned Indian arm of Sistema JSFC. Sistema Joint Stock Financial Corporation of Russia is one of Russia’s largest groups.
With $12 billion in consolidated revenues, the group is present in telecommunications, utilities, retail, high tech, pulp and paper, pharmaceuticals, health care, railway transportation, agriculture, finance, mass media and tourism. Since 2008, Sistema has invested over $4 billion in India, mostly in telecommunication services (brand MTS).