Kochi-based Islamic NBFC Cheraman Financial launching $40M VC fund, to back around 10 startups

Cheraman Financial Services Ltd (CFSL), a Kochi-based Sharia-compliant non-banking finance company (NBFC), has received market regulator SEBI's approval to launch a VC fund with a corpus of Rs 250 crore ($40 million), according to The Times of India, citing a top company executive.

To be christened Cheraman Premium Fund, the fund will invest in startups as well as infrastructural projects.

The proposed fund has already received 50 applications seeking investments and will shortlist and invest in around 10, the report said, quoting CFSL's managing director APM Mohammed Hanish. This may imply it would have an average investment size of around Rs 25 crore or around $4 million.

Cheraman Premium Fund will seek investments from both institutional and individual investors from within and outside India. However, it would limit the maximum contribution by a single investor to Rs 62.5 crore or $10 million.

In May this year, Kochi-based incubator Startup Village had announced the launch of a $10 million early-stage VC fund. The fund, which has already got SEBI approval, will mostly focus on companies operating in the internet and telecom space and will invest $20,000-$250,000 in startups across the country.

Separately, techpreneurs and businessmen from the state are planning an angel network to support startups based in the state in line with other geography focused angel investment networks like Mumbai Angels.

In October last year, the Kerala chapter of TiE (The Indus Entrepreneurs) had said it was planning to come up with a new form of seed fund for lending money to entrepreneurs in the state.

(Edited by Joby Puthuparampil Johnson)