Founder of CBay Systems sets up investment fund to back firms with IP

Venu Raman Kumar, who recently sold his remaining stake in NASDAQ-listed clinical documentation technology solutions firm MModal (formerly CBay Systems) to JP Morgan's PE arm One Equity Partners in a big ticket deal, has set up two stage-agnostic investment funds to invest in Indian and international companies.

While the domestic fund is worth Rs 100 crore ($18 million), the international fund is worth $50 million, he told Business Standard.

Kumar is looking at both technology and non-tech fields across startups, as well as more mature firms including public-listed companies.

He is currently an executive partner with New York-based private equity firm Sirius Capital and has also set up his own company called Aeries, which will manage all his investments.

The BS report has quoted him as saying that he is not looking to invest in the e-commerce segment as some of the models are not viable and are cash-guzzlers.

Kumar is also looking at firms with intellectual property (IP) and where he can have operational say as well. He would ideally like to have around half a dozen companies in his India portfolio.

He has already made his first bet by picking 19.4 per cent stake in the public-listed security solutions firm Zicom. As per shareholding disclosures, bulk of this stake is acquired through an investment vehicle called Aark Singapore Pte. The stake purchase was through a preferential allotment in July this year for around Rs 15 crore.

Kumar is also close to signing a deal with an eight-year-old firm incubated at the University of Waterloo which has developed IP that adds analytics to voice and which can then be embedded into chipsets. He told BS that he would co-invest along with a PE firm to pick a minority stake.

(Edited by Sanghamitra Mandal)