Former InnoVen execs to float $125 mn venture debt fund
Photo Credit: Shah Junaid/VCCircle

Two former top executives at venture debt provider InnoVen Capital India Pvt. Ltd are planning to launch their own venture debt firm Alteria Capital, a media report said on Thursday.

Ajay Hattangdi and Vinod Murali plan to raise a total corpus of Rs 1,000 crore ($125 million), including a greenshoe option of Rs 200 crore, The Economic Times reported, citing the duo.

Hattangdi recently quit as the CEO and Murali as the managing director and deputy CEO at Innoven, which is backed by Singapore state investment firm Temasek.

The duo is in the process of registering Alteria with the capital markets regulator Securities and Exchange Board of India (SEBI).

Hattangdi and Murali, who are managing partners at Alteria, could not be immediately reached out for comments.

Alteria Capital aims to mark the first close of its fund at Rs 250-500 crore in the first quarter of 2018.

The venture debt fund will be registered as a category II alternative investment fund (AIF), unlike InnoVen Capital, which operates as a non-banking financing company (NBFC).

“From an operating standpoint, the AIF is a more efficient vehicle to invest, especially with regard to exits for investors,” Hattangdi told the business daily.

Meanwhile, on Tuesday InnoVen Capital said its CEO of Singapore and Southeast Asia region, Chin Chao, will take additional charge as interim CEO for India as it looks for a permanent head.

InnoVen has provided about $225 million in capital to more than 100 tech startups across India. Its portfolio companies include Oyo Rooms, Swiggy, Byju’s, Nestaway, Pepperfry, Prizm Payments,, Shopclues, Myntra, FreeCharge, Manthan Software, Firstcry, Practo and Capillary Technologies.

The venture debt firm usually writes cheques after the Series A stage, but it mentors early-stage startups as well.

Venture debt is an important tool of funding for companies as it rarely involves stake dilution by the promoters.

It also provides the companies more time to grow. The segment is growing in India even as venture capital activity is seeing a slowdown.

Apart from InnoVen Capital, Delhi’s Trifecta Capital Advisors, Bengaluru-based Capital Float, IFMR Capital of Chennai and Ahmedabad-based Lendingkart are leading players offering debt funding to early-stage companies in India.

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