The Hindu Business Line : Indian-founded tech cos raise $270 m in Q2

HI-TECH companies founded by Indians in the US raised about $270 million in venture capital/private equity financing during the quarter ended December 31.

This, however, represents a drop in investment compared to the July-September quarter during which 40 Indian-founded companies raised over $400 million, says data released by TSJ Media.

Out of the 32 such companies that raised finance during the quarter, 13 closed rounds of $10 million or more, Mr Arun Natarajan, Editor, TSJ Media, said in a release.

The company tracks venture capital and mergers and acquisitions involving Indian-founded companies worldwide.

The $30-million second round funding raised by Dr S.V. Sreenivasan, co-founder of Molecular Imprints Inc, a Texas-based provider of imprint lithography systems that is used by semiconductor device and other manufacturers, received the single largest investment during the quarter. Hakuto Co Ltd, a Japan-based vendor of electronic components, manufacturing machinery, optical products and industrial chemicals, was a primary investor in the round.

Mr Anil Aggarwal, who co-founded Zeevo Inc, a semiconductor company with a special focus on Bluetooth technology, received the second largest investment during the period with its $20 million fifth round of funding.

The latest round, which takes the total financing raised by the California-based Zeevo to $85 million, was led by the Taiwan-based semiconductor firm, Winbond Electronics, and China Development Industrial Bank.

Previous investors, Sequoia Capital, Raza Ventures, WK Technology Fund and Focus Ventures, also participated in the round.

The $14.3 million raised by Mr Prakash Iyer, Mr Piyush Goel, and Mr Venkatesh Shukla co-founders of Everypath Inc, provider of mobile task automation solutions, was the third largest investment during the quarter, the data says. The latest round led by Trident Capital also included other new investors Bay Partners and Nippon Development Systems.

Existing investors including Sevin Rosen Funds, US Venture Partners, AsiaTech Management, Focus Ventures, ArrowPath Venture Capital, Redwood Ventures, Amerindo and Raza Foundries, also participated in the round.

The TSJ Media analysis revealed that the enterprise software products sector, which witnessed 16 deals, attracted the most number of investments for a second quarter in a row. The software sector was followed by the networking equipment sector with six investments. Semiconductors and related equipment vendors came in third with five investments, the data says.

According to the data, the buyout of Sunnyvale, California-based Neoteris Inc. by Nasdaq-listed network security firm, NetScreen Technologies, was the largest acquisition of an Indian-founded company during the quarter. Mr Sam Srinivas, Mr Surya Koneru and Mr Shyam Davuluru co-founded Neoteris, which was acquired for $295 million.

Under the deal, NetScreen will pay Neoteris shareholders $20 million in cash, about $245 million in NetScreen stock and an additional $30 million in cash upon the achievement of certain revenue milestones.

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