Two Paths Taken In India: Kleiner Quits, Sequoia Charges Ahead
It’s interesting to see two top-tier Sand Hill Road venture capital firms take opposite directions in India as overseas investor interest in the market picks up under new government leadership and expectation of fiscal reforms and economic growth.
India has been a tricky market for venture capital investors. It’s still early. Venture capitalists from the Valley who entered the Indian market about a decade ago have seen few exits either through IPOs or M&A — aside from the trophy success stories like Make My Trip, which went public in New York in 2010.
Kleiner Perkins’ move to withdraw from the Indian market is seen as a strategic move away from a fund it only indirectly managed with technology insider Ram Shririam with his investing firm Sherpalo Ventures. Sandeep Murthy, who was running the investments for the co-managed fund in India, now takes over a chunk of the portfolio with his new fund Lightbox. Another factor in the Sand Hill Road investor’s exit is the departure of KP’s Indian dealmaker Aniruddha Nazrefrom the firm.
But hope has sprung eternal. Many venture capitalists in India such as Ashish Gupta of Helion Venture Partners, Sudhir Sethi of IDG Ventures, Aniruddha Nazreformer VC of Kleiner Perkins and Naren Gupta of Nexus Venture Partners remain optimistic that the opportunities for India to create innovative tech companies that can scale globally are huge. Deals like the recent $210 million fund raising for Flipkart and its acquisition of Myntra reinforce that view. See earlier Forbes post, Flipkart and Startup India. Not to be overlooked is Café Coffee Day, a Starbucks SBUX +2.22% of India, which is heading toward an IPO on an overseas exchange.