IIFL launches Rs 1000 crore fund to invest in startups and VC funds
IIFL is raising Rs 1000 crore funds for investing in startups and venture capital funds. The high networth individuals (HNIs) from the industry are going to benefit from the startup activity in India. IIFL seeks to top among the competitors by availing fundings for the startup sector. The company expects about 40 per cent of the corpus to be invested directly in startups or as co-investments with other funds while 60 per cent of the capital will be allocated for investment in venture funds.
IIFL is one of India's largest wealth management companies which manages and advises over Rs 75521 crore in assets. The company is an online and offline broking, and an advisory services provider to retail and institutional clients in the cash and derivative segments. It is engaged in financing, wealth management and agency businesses. IIFL's agency business includes financial advisory and broking, institutional equities and investment banking, distribution, and realty and property advisory services. The Company operates in India, the United States, the United Kingdom, Singapore, Hong Kong, Switzerland, Mauritius and the United Arab Emirates.
Technology startups are a favourite pick when it comes to investing for rich Indians. Kotak Wealth Management report estimated that 39 per cent want to invest in technology venture capital funds, 35 per cent in real estate, 23 per cent in financial services, 22 per cent in pharmaceutical sector. Venture capital fund investment in India increased by 5.05 per cent to Rs 15600 crore as of June 2015 on yearly basis. IIFL Wealth also plans to set up an incubation centre for startups and will invest Rs 25 to 50 crore in the fund itself. The fund is expected to crack deal by the month of September this fiscal year.
IIFL competitor Edelweiss Financial Services also working on startup sector and appointed hedge fund executive Pranav Parikh to lead venture capital funds. The competitor will launch funds over the next few quarters.
Prime Minister emphasize on startups on the occasion of Independence day. The government is looking at systems for enabling start-ups. India is aiming to be number 1 in start-ups with a slogan 'Start-up India' and 'Stand up India.' The PM stated that rural areas and tribal & Dalit populations must develop entrepreneurial skills to free themselves of poverty. However, not a single startup is located in rural India.Modi wants each of India’s 1.25 lakh bank branches to fund one startup each. While most of these branches are located in urban India.