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Social+Capital Looking To Invest $1 Billion In Non-Conventional Indian Startups

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The Indian startup ecosystem, growing at an unprecedented rate, has received investments of $ 1 billion in the first quarter of 2015. The belief of investors in this revenue model is one of the reasons why, top global investors such as Sequoia, Tiger Global, Saif-Partners have invested staggering sums into the Indian market.

However, all of those investments have rather been in business models, which have been tried and tested in western markets already, but are new to India. Social+Capital, the investor behind mobile payments startup Ezetap, though, is eyeing to reverse that trend.

Chamath Palihapitiya, the man behind Californian venture capitalist firm Social+Capital Partnership, has announced his aspiration to invest around $1 billion into India in the next 10 years, across unconventional sectors.

The former Facebook executive has already charted out the sectors he is looking forward to finance. Those sectors include: financial services, power and energy, infrastructure, agriculture and the industries which are endemic to the Indian market.

Coming off from an invest of $20 million into the mobile payments start-up Ezetap, the Sri-Lankan born investor stated that he has no desire to invest in companies that are Indian versions of the American revenue models. He decisively wishes to put his money into those start-ups that cater specifically to the Indian audiences, and which in turn positively impact the Indian eco-system,

Previously, the Social+Capital Partnership had invested in businesses such as Box, Palantir and Slack. Palihapitiya currently is part of the Ezetap board as its Chairman. Ezetap, India’s mobile payments solutions providers is the first company he is directing outside of the US.

Though the Indian market is new to Palihapitiya, he has shown a keen interest to understand its nuances, and has already teamed up with Bengaluru’s seed-stage VC fund Prime Venture Partners to further this endeavor. In fact, Social+Capital, was introduced to Ezetap by Prime Venture Partners.

Palihapitiya, who is attributed with Facebook’s fruitful scale from 18 million to 1 billion users, believes that the biggest problem in the Indian ecosystem is the blind following of business models created specifically for US. Terming these models as ‘stupid’, Palihapitiya looks to see start-up’s tap the one-billion plus Indian market through sustainable revenue-models. Not long ago, his VC firm had raised $600 million taking the tally to $1 billion after the third round of investments.

With so much money coming into the Indian market, the start-up boom spearheaded by the silicon valley of India, Bengaluru has emerged as one of the fastest growing startup hubs in the world and has been ranked as the 15th best startup ecosystem in the world in a report by Compass.


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