New adventures of old family firms

JSW Ventures is riding the crest of the family office wave, which has just reached Indian shores

Most of these business houses chose to be LPs. There is some amount of disillusionment in going down that route

JSW Ventures’ investments are set to be small and in the range $1-2 million over two rounds

Patient capital is the name of the game for family offices with a 10-year investment cycle

Greater participation by family offices into venture funding in India is much needed as most of the LPs in the current VC firms are in China and the US

This news didn’t get a lot of attention. But it is important. Late last month, JSW Ventures invested in Indus OS, a mobile operating system in regional languages. The company started as language technology company in 2014. Fast forward to 2016, in the first quarter, the startup cracked the market and gained a significant market share, becoming the second largest smartphone OS in India, according to Counterpoint Research.

This is what The Economic Times had to say:

“The company is betting big on Indus OS 3.0 as a major milestone. The company has been working closely with leading hardware and developer partners in the Indian smartphone ecosystem to build the platform, to be released in the next quarter.”

Indus OS is a curious company, and a bet in it speaks of a bigger plan by the investor.

Set up less than a year ago with a fund size of Rs 100 crore, the family office of the JSW Group wants to be noticed as a serious early stage investor. And this is JSW Ventures’ third investment. It has earlier pumped capital into Overcart and Purplle. And an investment in an unnamed SaaS company is set to be announced in May.

The JSW Group has been on an expansion mode. Its core areas are currently steel, energy, infrastructure and cement. The conglomerate has been looking to find more sources of revenue in different business verticals. It is the Jindal family’s first foray into venture capital. An incursion into new technology it, so far, has no play in. A way to maximise revenue in a sector, where it can have greater return with fewer risks. Parth Jindal, son of Sajjan Jindal, has been at its helm. The Harvard graduate is also the CEO of Bengaluru FC, an Indian professional football club based in Bengaluru.

Times, they are a-changin’

JSW Ventures isn't the only family office that has started to find value in the market. Premji Invest, Azim Premji's family office, too, which has a fund size of over $1 billion, has made over 60 investments in 11 years

JSW Ventures isn’t the only family office that has started to find value in the market. Premji Invest, Azim Premji’s family office, too, which has a fund size of over $1 billion, has made over 60 investments in 11 years. It has also started to take more meetings with an eye on startups, say sources. Sharp Ventures, run by Rishabh Mariwala of Marico, invested in LEAP, a supply chain firm, a few months ago.

AUTHOR

Patanjali Pahwa

Patanjali has spent over seven years in journalism. He last worked at Business Standard as Principal Correspondent, where he wrote on startups, e-commerce companies and venture capital. He has worked at an array of institutions, which include Forbes India, Caravan and Outlook Business. He is a Mumbaikar, born and brought up. Patanjali did his BSc in IT from Mumbai University and then got his journalism degree from IIJNM in Bangalore. He is enamoured by Ernest Hemingway and Tom Waits and may try to sneak in references to them in his stories.

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