Two titans of the retail industry are joining hands to foster entrepreneurship. Noel Tata, Ratan Tata’s half-brother and managing director of retail major Trent, and Pantaloon group Managing Director Kishore Biyani are mentoring an asset management company promoted by Ved Prakash Arya (35), former chief operating officer of Pantaloon Retail.
Tata and Biyani have joined the director’s board of Milestone Capital Advisors promoted by Ved Prakash Arya. The asset management company will invest in real estate projects.
Both Biyani and Tata, in many ways, symbolise the rise of Indian entrepreneurs. While Noel Tata, the son of Simone Tata, popularised the concept of departmental store retailing through his Westside chain, Biyani’s Big Bazar was the maiden attempt at organised discount retailing.
For starters, Milestone Capital is launching a Rs 250 crore domestic venture capital fund, which will invest in projects in cities like Nashik, Nagpur, Coimbatore, Jaipur and Mysore where entrepreneurship is thriving. Arya, who used to manage joint venture companies in Pantaloon Retail, has now moved to a small office in the western Mumbai suburb Ville Parle with a skeletal staff.
“My aim is to promote small entrepreneurs who want to be part of the global India. Noel Tata and Kishore Biyani will play the role of mentors,” says Arya. Sources said some large corporates and financial institutions had invested in the venture. When contacted, Biyani said: "I have always been interested in fostering entrepreneurship."
Arya has roped in his IIM batchmate Arvind Bansal as co-promoter. Bansal, co-founder of the Australian company Mission Biofuels, has a history of incubating companies. The asset management company is in the process of creating joint ventures with entrepreneurs in Tier-11 and Tier-111 cities. Investments will be made in real estate ventures in the retail, residential and hospitality verticals. Under the plan, the venture fund will invest in special purpose vehicles created for a particular project. “We expect to get a return of 30 per cent from each project. And we plan to exit after five years,” said an executive of Milestone Capital.
Milestone Capital is yet another example of real estate investment trusts, which are now being launched to cash in on the upswing in the Indian property market. Many corporates, including the Ajay Piramal group, ICICI and Pantaloon, have launched real estate investment trusts. These ventures are investing in big real estate projects. Real estate investment trusts control up to 80 per cent of the real estate projects in developed markets like the US.