Fund focus: New name, new era for IDG in India

After IDG Ventures India's second fund closed at INR6 billion ($82 million) in 2013, well short of the targeted $175 million, the firm focused on building its domestic LP base. Those efforts paid off with the latest fund, which raised $208 million last year, with 45% of its commitments coming from Indian investors. 

"We have some of India's major industrial players and families in our LP base, and they have been very instrumental in helping us understand the other India, beyond the metros," says Karthik Prabhakar, partner and global head of fundraising at Chiratae. "With the domestic LP base growing, we believe it's important to have a very strong India positioning, to show that we are moving quickly to adapt to the changing environment."

Now the firm has decided to emphasize its commitment to India by rebranding as Chiratae Ventures – a name taken from the word for leopard in the local language of Bangalore. The new brand is meant to reflect the firm's speed and adaptability in India's rapidly developing entrepreneurial ecosystem.

The rebranding ends an association with IDG that has stood since the GP's founding in 2006, but the transition has been smooth. IDG hasn't been an investor since China-based IDG Capital – the new owner of the global IDG Ventures network – sold off its stakes in various funds last year. Chiratae has no formal connection to the parent or with the IDG Ventures brands in other countries, though the managers of the respective franchises share observations about the market. 

While the firm was under no obligation to update its name, it decided a change was appropriate. "It's been in mind ever since IDG was sold. IDG was the sole investor in our first fund, but over time our LP base has diversified and IDG itself has sold out, so that relationship no longer exists," says Prabhakar. "But the key reason for the change is that India's becoming a very dominant player in the venture ecosystem, and we thought this was the right time to demonstrate that in our brand."

Chiratae's management team is unchanged and the firm intends to maintain its focus on early-stage start-ups creating technology-enabled solutions for problems specific to India in a broad range of sectors, including agriculture, healthcare, and retail. 

One element of Chiratae's approach that is evolving is its value-add strategy. Domestic LPs are becoming more involved and the firm plans to increase its focus on finding collaboration opportunities between entrepreneurs and investors. For instance, one of its LPs, a prominent publisher of vernacular language content, has provided mentoring services to help portfolio companies improve customer outreach.

"India has 22 official languages, and nearly 20,000 languages spoken as a mother tongue, and vernacular content is growing in a big way," Prabhakar says. "So some of these relationships can help us in understanding the nuances of reaching these customer segments, and thereby help our companies."   

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• Topics
• South Asia
• Venture
• Technology
• GPs
• India
• IDG Ventures