Serial healthcare entrepreneur GSK Velu, who last year sold his stake in pathology chain Metropolis Healthcare, has launched two funds worth a total $175 million to invest in healthcare delivery, consumer and enterprise technology segments.
While one fund is a family office that will essentially manage his private investments with a corpus of $75 million (Rs 500 crore), the other is a formal venture capital fund christened Stakeboat Capital, the firm said on Thursday.
Velu, who will be an anchor investor in Stakeboat Capital, will contribute $20 million to the fund. The remaining will be raised from domestic family offices and local and international institutional investors.
"I have been working with PE investors for 11 years now. I know what entrepreneurs are looking for and where PE can add most value. We will follow a promoter-friendly approach," Velu, chairman and managing director of Trivitron Group of Companies, said in a statement.
Kandasamy Chandrasekar and A Ganesan are General Partners (GPs), or key investment managers, in Stakeboat Capital. Chandrasekar is a private equity veteran who was earlier associated with Carlyle and ICICI Venture while Ganesan is a chartered accountant and Velu's confidant.
The fund is awaiting capital markets regulator Securities and Exchange Board of India's approval, though it is already pursuing investment opportunities.
"The investments will be made from the anchor contribution before external funds are raised from the market. It will look at a seven-year fund with an optional 'two plus' years and an investment window of four-five years in each investee company," said Chandrasekar.
Stakeboat Capital will target companies looking to raise Series B investments and have established business models and cash flows. Indeed, Series B and Series C round VC investments, representing mid-stage deals in the startup funding cycle, have seen a sharp deceleration as investors tighten their purse strings (click here for more on that).
While it will look at investing in consumer-led businesses, the fund will avoid investing in the consumer internet segment, the statement said.
The family office investments will be longer term and more strategic in nature, Ganesan said.
With the family office, Velu will join a fast expanding pool of new- and old-generation entrepreneurs who have carved out a part or all of their personal wealth into an investment vehicle with a formal fund manager.
Both Stakeboat Capital and the family office will also co-invest in deals where capital requirements are larger.
In 2015, Velu had exited Metropolis after reports of a boardroom struggle with the pathology chain's Shah family. Velu was apparently kept in the dark about the Shah family buying out Warburg Pincus' 27 per cent stake for Rs 550 crore with the backing of KKR India, increasing the family's stake in Metropolis to 63 per cent from 36 per cent. Eventually, private equity firm Carlyle bought out Velu's stake.