Exfinity, the private equity (PE) venture promoted by former Infosys board members — TV Mohandas Pai and V Balakrishnan — plans to raise its second rupee-denominated fund worth Rs 250 crore. The fund will invest in Indian startups focused on technology, such as social, mobility, cloud and analytics, or what is generally referred to as SMAC.
Exfinity has filed with the Securities Exchange Board of India (Sebi) for the necessary approvals and will start the process of raising the fund in 2-3 weeks. This fund will also have a greenshoe option.
The PE venture has two other key founders — former joint CEO of Wipro’s IT business Girish Paranjpe and Deepak Ghaisas, former CEO of I-flex Solutions.
Talking to FE, Balakrishnan said that in the second fund, the promoters would hold 5-10%, with the rest raised from high networth individuals. Exfinity raised its first fund of Rs 125 crore to invest $1-2 million in tech startups at the Series A and pre-series A stages.
In the second, Rs 250-crore fund, Exfinity plans the option of follow-on investments. Balakrishnan said there was a significant number of Indian startups with good ideas, adding, “the chances of creating value is very high.”
With the first fund, Exfinity invested in five companies and plans are afoot to invest in three more firms, taking the total number to eight.
Exfinity, in its first fund, raised Rs 125 crore in August, 2014. The fund had announced its first close of Rs 100 crore in June 2014 and the greenshoe option of Rs 25 crore was open for subscription. Investors included CXOs, reputed industrialists, family offices, professionals and UHNIs.
Balakrishnan claims Exfinity’s edge in the marketplace is the industry experience of promoters and the ability to give good guidance. On the proposed $100-million offshore fund to be based out of Mauritius, he said it would take some more time.
India’s startup ecosystem has gained momentum, with Nasscom, in a recent study along with Zinnov, predicting that the country is expected to be home to at least 11,500 technology startups by 2020, up from 3,000 currently, driven by a demand for solutions around new-age technologies.
The study said that Indian startups, with their unique solutions, are witnessing increased traction in global whitespace opportunities such as internet of things, augmented realty and smart hardware, among others.
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