VENTURE CAPITAL FIRMFinancial Management :Live Project

Made by:Pratichi Bhatia

INTRODUCTION

What is Capital? •  Fund employed in any business activity.• Most important factor for production.• No economic entity can function without capital

Venture capital is significant innovation of 20th century. It is generally consider as synonym of risky capital. Venture capital is a new financial service, the emergence of which wants towards developing strategies to help a new class of new entrepreneurs to translate their business ideas into realities.

VENTURE CAPITAL

• Venture capital is a type of private equity capital typically provided by outside investors to new businesses . Generally made as cash in exchange for shares in the investee company, venture capital investments are usually high risk, but offer the potential for above-average return.

• A venture capital fund is a pooled investment scheme that primarily invests the financial capital of third-party investors in enterprises that are too risky for the standard capital markets or bank loans.

• This form of raising capital is popular among new companies, or ventures, with limited operating history, who cannot raise funds through a debt issue.

• The drawback of this form of entrepreneurship is that the investors get a say in the management of the company apart from the equity holding.

STAGES IN VENTURE CAPITAL

• Round 2- Working capital for early stage companies that are selling product, but not yet turning a profit.

• Round 3- Also called Mezzanine financing, this is expansion money for a newly profitable company.

• Round 4-  Also called bridge financing, it is intended to finance the "going public process.”

• Low level financing needed to prove a new idea

Stage 1 Seed Money

• Early stage firms that need funding for expenses associated with marketing and product development.

Stage 2 Start-up

• Early sales and manufacturing funds

Stage 3 Round (1)

KAE CAPITALThe investor….

MAN BEHIND KAE…!

SASHA MIRCHANDANISasha Mirchandani is Managing Director and Founder of Kae Capital and Co-founder Mumbai Angels.

His investments include Fractal Analytics, Inmobi, Healthkart, Myntra, Greendust, Cloudbyte, Canvera and Mettl. Sasha sits on the Boards of Hathway Cable and Datacom Limited, Akasaka Electronics Limited and Mumbai Angels Venture Mentors among others.

Sasha completed his Business Administration from Strayer University and MMDP program at IIM, Ahmedabad. He is a Charter Member at TiE Mumbai. He is also Past President of Entrepreneurs Organisation (EO) Mumbai and is a member of the Mumbai Chapter of the Young Presidents Organisation (YPO). He is also on the Board of Governors of the Universal Business School.

KAE CAPITAL

A destination for early stage companies to acquire capital for growth. Kae Capital is a sector agnostic fund and invests in companies which bring about innovative solutions for the existing gaps in the markets, backed by a great team. Their focus – investing in Innovation, Leadership and Growth.They bring in the expertise of identifying and building large companies even from a concept. The team at Kae Capital has a wide range of experience in helping companies grow, fill gaps in the market and help create winning companies.They believe entrepreneurs can shape the future of the world. They want to partner with passionate and energetic entrepreneurs who have the drive to change the future.Technology excites us. They look for entrepreneurs who envision technology as a means to disrupt sectors such as Mobile, e-Commerce, Education, Healthcare, Consumer Internet and so on. They think technology holds the highest potential to shape our lives in a new future.They understand the importance of speed for a start-up and they carry out our process in the same spirit.

MORE ABOUT KAE CAPITAL

Investment Structure

• Investment is made between $0.05 – $2.5 Mn and typically they invest between $0.2 – $1 Mn in the first round.

• Industries: Mobile, Ecommerce, Education, Healthcare, Consumer, Internet

₹ Networth (Friday, August 26, 2016)

• ₹ 12.33 Cr (approx.) in total.

• Start-ups Funded:

Sys Cloud, Shep Hertz,

Fortune Play, Nuiku, Shopsense, Airwoot.

PARAMETERS THEY EVALUATE

The major parameters they evaluate before investing –

• Committed and capable team with a clarity of purpose

• Innovation

• Market Size

• Value Proposition

• Business opportunity and Scalability

• Capital efficiency

QUESTIONS!

• What industries/sectors do they invest in?

Kae Capital is a sector agnostic fund and they are open to invest any business which has the potential to achieve scale along with sound financial performance.

• At what stage of a company’s lifecycle do they invest?

They get into a company at the pre-series A stage and also do follow on investments in the Series A and B rounds. Their strategy is to be the first institutional investors in any company that they get into.

• How do they get involved in a company post investment?

They regularly monitor the performance of their portfolio companies and act as a mentor/guide to show the way forward and resolve any issues that companies face.

QUESTIONS!

• Do they have a location preference for their investments?

They prefer their portfolio companies to be based out of India.

• How much do they invest?

They, as a fund can invest up to $3mn in the entire life cycle of their association with any company. They don’t restrict themselves to go all out on the companies which are deserving.

QUESTIONS!

• What value do they bring to start-ups?

Their extensive experience and deep connections within several industries has been instrumental in the way that they have contributed towards the growth of their portfolio companies. Apart from opening doors they also help start-ups directly in issues like team building, strategy, finance and further fund raise.

• What is the process that they follow?

They first go through the submitted business plan and then do a preliminary call/meeting with the promoters. Stage two is internal evaluation of the opportunity after which they decide to have detailed discussions with the promoters and go ahead with their diligence. The time taken in the entire process varies in every deal.

THEY INVESTED IN!

They invested in multi channels such as cloud, consumer internet, mobile, payments, technology in India as well as USA.

THANK YOU!