Exclusive: Morpheus Capital founder Nayar quits to join fintech startup NextGen

Balu Nayar, who founded venture capital firm Morpheus Capital Advisors Pvt Ltd in 2009, has been bit by the entrepreneurial bug again. He has quit his position as MD of the firm to join fin-tech startup NextGen Telesolutions Pvt Ltd as co-founder.

Founded in 2012, NextGen is promoted by serial entrepreneurs Chandra Mohan and Taron Mohan.

Nayar will, however, retain his stake in Morpheus.

"We're now poised to get to the next orbit, and have just commenced a fund-raising round to raise $4 million. In the course of business development, we've already got equity infusion offers from two MNCs (finance/retail players), but have deferred these discussions for strategic reasons," said Nayar.

While Nayar will oversee the business end of the venture, Taron will continue to spearhead product development, where he has been working on NextGen's secure element technology for the past 18 months.

NextGen's secure element product – a platform that hosts confidential and cryptographic data – is a wafer-thin chip affixed to a SIM card inside a mobile phone. The chip can function on the operating system of any phone – Android, iOS or Windows, and even on any non-smartphone.

The chip can be used to facilitate virtual credit card transactions and can eliminate OTP for online transactions. For this, the company is partnering with various institutions, including banks, e-commerce players and telecom companies, "These partners can occupy real estate on the chip to provide their services. They will be charged on an annual rental basis," said Nayar.

Besides India, the company is also looking at the African and Southeast Asian markets.

"The advantage of NFC (near field communication) in our solution is the capability to host an 'offline' wallet directly on our secure element. In regular NFC devices, it is not possible to host an offline wallet on a device, because there is no secure area available for the wallet storage," says Nayar.

Other players that provide mobile payments via NFC are Magictap Solutions Pvt Ltd and iKaaz Software Pvt Ltd.

In December 2014, iKaaz had partnered with DCB Bank to provide NFC-based payment solutions. The firm offers mobile payments platform to enterprises, business correspondents and merchants in developed and emerging markets through its flagship NFC-enabled reader which can be used as a mobile POS. It also provides an NFC tag, which costs less than $2, that can be installed in any phone, turning it into a POS facilitator. Besides India, the firm has also expanded its services to Kenya and Nigeria in 2014.

Noida-based Magictap Solutions Pvt Ltd leverages NFC and radio frequency identification (RFID) technology to not only enable payments but also provides experiential marketing solutions such as social media activations at concerts, conferences, product launches, restaurants, etc.

Chandra Mohan began his entrepreneurial career in 1970 with Punjab Tractors Ltd., a diversified agriculture equipment manufacturer.

An IIT-Kharagpur and IIM-Bangalore alumnus, Nayar has also been the regional director, APAC region at Yahoo! Mobile. His other stints include senior positions at Hutchison India (now Vodafone) and Star India.

Before founding Morpheus, Nayar was managing director at IMG India where he designed and launched the money-spinning limited overs cricket tourney Indian Premier League (IPL).

Morpheus Capital Advisors has invested in four startups between 2012 and 2015, according to VCCEdge data, the most recent being in 2015 in Vas Data Services Pvt Ltd which operates online shopping portal Yepme.com. The others startups include multi-channel virtual retailer TVC Skyshop, personal care products maker IPSA Labs Pvt Ltd and pharmaceuticals firm Shelter Pharma Ltd.