Kalaari eyes seed funding deals, to also incubate startups

Venture capital fund Kalaari Capital is planning to invest about $20 million (around Rs 135.7 crore) in 40 startups over the next two years as part of its seed and incubation programme.

"We didn't do a single seed deal in the last 10 years, but we feel that there is a requirement and a gap in the market in terms of mentoring," Vani Kola, MD, Kalaari Capital told The Economic Times.

An email sent by VCCircle to Kalaari Capital seeking details about the investment plans did not elicit a response at the time of filing this report.

Kalaari Capital which had raised $290 million in 2015 has been focused on Series A funding rounds.

The venture capital fund has also brought in one of Silicon Valley's high-profile female executives and former CTO of Cisco, Padmasree Warrior, and Airbnb's global expansion head Varsha Rao to mentor startups that it will invest in under its seed investment programme named KStart. KStart will have five startups in every batch starting every quarter.

Kalaari Capital also said that it will have an option to invest up to 50 per cent in new funding rounds being raised by its portfolio companies to minimise risk.

Last year, Kalaari Capital had roped in a new partner while elevating an existing team member as a partner besides adding two industry executives to its advisory team. Bala Srinivasa, former senior managing director at Copal Amba, had joined the VC firm as a partner while it elevated Sumit Jain as a partner.

Ravi Venkatesan (chairman at Bank of Baroda, board member at Rockefeller Foundation and Infosys and former chairman at Microsoft India and Cummins India) and Ram Gupta (chairman and CEO at Castiron Systems, executive vice president at PeopleSoft and senior vice president at WebMD) had also joined Kalaari's advisory team.

Earlier in 2015, Tata Sons' chairman emeritus Ratan Tata joined as an advisor to Kalaari.

Kalaari Capital has been active in India since 2006 and has $350 million under management. Currently, the VC firm provides capital to early stage companies operating in India and US across sectors such as technology, cleantech, healthcare, education, pharma, food and beverages, technology enabled services, media and entertainment and retail. It typically invests between $1 million and $5 million.

Its portfolio companies include online marketplace Snapdeal, lingerie e-retailer Zivame, payment solutions provider Instamojo, education services provider SuperProfs.com, e-learning portal Simplilearn and online furniture store Urban Ladder, among others.

Last month Kalaari Capital backed cashback and coupons site CashKaro raised an undisclosed amount in funding from Tata.

In September 2015, Tata made a personal investment in food-tech startup Holachef Hospitality Pvt Ltd as part of the Series A financing round led by Kalaari Capital and others.

The same month, Tata participated in a funding round at YourStory, whose content and events compete with some offerings from Techcircle.in and VCC Events, which are both part of VCCircle Network.