US-based Clearstone Venture Partners, the company which made investments in eToys, paypal (which was later acquired by eBay) and other internet-based companies has set up a $300 million global fund.
This fund will invest in Indian companies in the retail-software and media and entertainment sectors. This is the third round of funds and prior to this the company had invested $800 million in three rounds.
The company recently invested $8.5 million in DGB Microsystems, a telecom startup company that manufactures mobile handsets and made another investment of $5 million in BillDesk, a company that provides electronic payment services for banks and mutual fund industry.
We look to invest in early and growth stage companies in the retail-software segment since the retail market is booming in India and are in talks with couple of companies in these sectors, says Rahul Khanna head of India operations of Clearstone Venture Partners.
Clearstone's gameplan is to invest in companies at an early stage and stay invested in it for four years and then look to take it public. "Our investment will be in the $5 — 10 million range and we will invest in companies that hold potential," says Khanna.
Currently, Polaris Retail Infotech Limited, a wholly owned subsidiary of software company Polaris software Lab offers technology solutions to the retail industry. Another prominent player is Future Office Products, a wholly owned subsidiary of Kishore Bayani promoted Pantaloon Retail.
Recently 3i along with a consortium of other partners invested $120 million in Nimbus Communications, a player in the entertainment and media sector.
"While financial services and telecom are the sectors that we have currently invested in, we see growth in niches within a sector such as retail and media and entertainment," he adds.
Further the company plans to invest in retail technology solutions companies that will make software for information kiosks in shopping malls across India, which would aid a customer to find any item, such as different types of chocolates that are lost in a crowd of shelves.
The Indian media and entertainment industry is expected to grow at 19 per cent compound annual growth rate to reach Rs 83,740 crore by 2010 from Rs 35,300 crore at present, according to a study conducted by FICCI and PricewaterhouseCoopers in 2006.