Walden to launch $100m India semiconductor start-ups fund

According to The Economic Times, the $100 million fund will begin investing later this year and has already identified four start-ups, two each in Bangalore and Hyderabad.

Walden's new fund comes at a time when the central government has also announced new initiatives for the semiconductor industry.

Last week, the government gave "in-principle" approval for two international consortiums to establish India's first semiconductor fabrication plants and said it would reimburse a quarter of the capital expenditure incurred to set up such units. One consortium comprises Israel's Tower Semiconductor, IBM and India's Jaypee group, while the other has Franco-Italian STMicroelectronics and Hindustan Semiconductor Manufacturing as members.

"It [semiconductors] is a very valuable space and exits are generally large, over $300 million or more," said Lip Bu Tan, chairman and cofounder of Walden International. "But not many companies get made in this space due to risks involved and lack of competent backers."

The firm is looking for companies with innovative solutions in the low power consumption space, and expects to invest around $2 million in each start-up. It will also back ventures in the consumer internet space.

Tan invested in start-up Cosmic Circuits, a provider of analog and mixed signal intellectual property (IP) cores, in 2011 and joined the company board. Earlier this year Cosmic was acquired by Cadence Design Systems, of which Tan is President and CEO.

In 2011 Walden launched the first semiconductor industry-focused fund in China. The RMB500 million ($81.6 million at the time) Shanghai Walden Venture Capital Enterprise Fund raised capital from ARM, Taiwan Semiconductor Manufacturing, Samsung Venture Investment Corporation, Ag Investors (affiliated with Silver Lake) and SDIC High-Tech Investment, among other investors.

Walden's other India investments have been in the outsourcing sector, such as Quatrro BPO Solutions and Anantara Solutions. This April it backed digital signal processing systems firm Ittiam Systems with $350,000.

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