Kerala is poised for a stronger start-up ecosystem as four investment funds are likely to invest more than ₹1,000 crore in new business ventures in the next four years.
The State government has selected Unicorn India Ventures, Exseed Electron Fund, Indian Angel Network and Speciale Incept Fund against a tender floated recently, said M Sivasankar, Secretary, Kerala Electronics and IT Department.
Since the pact mandates investing 25 per cent of the volunteered amount in the next four years, the State is guaranteed with a minimum investment of ₹300 crore by 2022 fiscal, he said on the sidelines of ‘Seeding Kerala’.
The fourth edition of the event, organised here by Kerala Startup Mision (KSUM) in association with investment platform LetsVenture, brought together the State’s HNIs in a bid to provide them opportunities to invest in potentially rewarding start-ups.
Sivasankar pointed out that the Kerala government has adopted the Fund of Funds model to invigorate angel and VC funds. The State, on its part, provides an annual investment of ₹15 crore. The first leg of 2017-launched ‘Seeding Kerala’ saw encouraging results, prompting the government to aim at raising investments worth ₹60 crore. The State got 34 expressions of interest, from which four funds were invited to the KSUM endeavour on developing the state’s start-up ecosystem, he added.
Among the four, Exseed will invest solely in start-ups based in the fields of space and IT, he said.
The State will also encourage funds for start-ups working in the sectors of cancer treatment and disaster management.
Funds crunch
KSUM CEO Saji Gopinath said the selection of the four funds would help the State tide over its funds crunch.
The first two editions (both in 2017) of ‘Seeding Kerala’ strove to introduce angel investors from outside Kerala to the State. Into the third, the focus turned to HNIs within Kerala and linking them with start-ups that merit investment.