The Hindu Business Line : Venture capital firm Walden to re-enter India

San Francisco-based venture capital (VC) firm Walden International – better known for its investment in Bangalore- based IT firm Mindtree Consulting – is re-entering India after a five-year-long hiatus.

It has appointed Mr Rajesh Subramaniam, the erstwhile Chief Financial Officer of BPO firm Firstsource Solutions, as Managing Director (for India) – reflecting the increasing demand from the VC industry for senior officials with operational knowledge from diverse industries.

Walden is looking at making sector agnostic ‘early to expansion stage’ investments in start-ups that have a scalable business model, Mr Subramaniam told Business Line.

“The growing pace of domestic consumption of products and services in India is prompting Walden to commit serious capital and time to India,” said Mr Subramaniam. Founded in 1987, Walden has over $1.6 billion (Rs 672 crore) in committed capital.

“Since Walden’s portfolio was not as wide as some of the other players they probably did not feel the need of having an India specific presence five years ago; investments already made in Indian companies were handled out of the US,” according to Mr Arun Natarajan, Chief Executive Officer of Venture Intelligence, a company which tracks the VC industry.

A Hawkins and Doyle report estimates VC investments in India to reach a record $928 million (Rs 3,900 crore) in 2008.

Globally, Walden’s investments are focused on financing early stage companies in industry sectors such as communications, electronics/digital consumer, software & IT services, and semiconductors.

The VC industry requires more people with ‘hands on’ operational knowledge of particular sectors than anything else as the industry goes through alternative cycles of boom and bust, said Mr Natarajan. He believes that the most successful VC partners are those who have been associated with the operations of a successful company, which explains why the VC industry is poaching big time from across industries.