The Hindu Business Line : Indian-founded US cos raise $470 m funding

HI-TECH companies founded by Indians in the US raised over $470 million (about Rs 2,100 crore) in venture capital/private equity financing during the quarter ended March 2004.

According to data from TSJ Media, which tracks venture capital and merger and acquisition activity involving Indian-founded companies worldwide, out of the 43 such companies that raised financing during the quarter, 19 closed rounds of $10 million (Rs 45 crore) or more.

"These numbers represent a significant rise in investment in such companies compared to the October-December 2003 quarter during which 32 Indian-founded companies had raised over $267 million (over Rs 1,200 crore)," said Mr Arun Natarajan, Editor, TSJ Media, in a release.

The $42 million (over Rs 180 crore) second round funding raised by CipherTrust Inc, an Atlanta-based firm founded by Mr Jay Chaudhry, was the largest single investment during the quarter. The funding was co-led by Greylock and Battery Ventures and received participation from US Venture Partners, Noro-Moseley Partners and Silicon Valley Bank.

The $32 million (about Rs 140 crore) fourth round funding raised by 3PAR, a California-based firm co-founded by Mr Ashok Singhal, was the second. The third largest investment during the period was the $30 million (around Rs 135 crore) raised by Mr Gaurav Garg, co-founder of Redback Networks Inc, a Nasdaq-listed firm, from Technology Crossover Ventures.

Among the merger and acquisition deals, Ejasent Inc, a California-based firm co-founded by Mr Rajeev Bharadhwaj, was acquired by Nasdaq-listed Veritas Software Corporation for $59 million (about Rs 265 crore) in cash.

Similarly, TeraBlaze Inc, a California-based company founded by Mr Shankar Mukherjee, was acquired by Agere Systems, a semiconductor company, for $21 million (over Rs 91 crore). Velio Communications Inc, a California-based firm founded by Mr Raju Chekuri, was acquired by LSI Logic for about $20 (Rs 90 crore) million in cash, says the release.