Softbank announces India VC fund

Softbank Investment and India's SBI Capital Markets to launch a $100 million India-focused venture capital fund.
Softbank Investment and SBI Capital Markets announced plans on August 28 to launch a $100 million India-focused venture capital fund. The fund will make investments of $5-10 million with a holding horizon of 3-5 years. Target segments include business process outsourcing (BPO), knowledge process outsourcing (KPO), life sciences, online businesses, technology-enabled design and manufacturing. The fund will also explore emerging areas such as nano technology and environmental technology.

Softbank is the venture capital arm of JapanÆs SBI Holdings Inc. This investment represents SoftbankÆs first and currently only India fund. SBI Capital Markets is the investment banking subsidiary of IndiaÆs largest bank, the State Bank of India. This is the first foray of the State Bank of India Group into venture capital investing.

Softbank currently manages 18 other venture funds across sectors and geographies, including a recent collaboration with Singapore's Temasek Holdings focused on China. Softbank has successful investments like Yahoo! and E*trade to its credit.

State Bank of India 's Chairman, OP Bhatt, described the alliance as "a small but significant step towards creating and nurturing knowledge-based industries in India.ö

Softbank CEO, Yoshitaka Kitao suggested further India plans are planned. He stated: ôOur fund with SBI CAP is only a first step in a well-planned strategy to partner with leading financial services companies and deliver creative financial products focused on India. We will soon be making some important û even historic - long-term announcements about our comprehensive India strategy."

Venture capital investing has seen a resurgence in India in the recent past. It is fuelled by the number of entrepreneurs with bankable business propositions in spaces where India enjoys a competitive advantage - for example BPO.
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