Facebook co-founder Eduardo Saverin's PE firm Velos to start investing in India

14 Oct, 2014

Soon after Mark Zuckerberg showed his love for India through his much publicised visit to the country recently, it's now the turn of the other Facebook co-founder to do his bit. Eduardo Saverin, the billionaire co-founder of Facebook, will soon start making investments in India, among other countries in Asia Pacific, through a private equity firm he co-founded in 2013.

His firm, Velos Partners, with offices in Los Angeles and Singalore, will provide growth capital to companies focused on retail innovation, health & wellness and luxury & entertainment. The firm has hired Samrat Ganguly, who was earlier CEO and managing partner of the venture capital arm of SREI Infrastructure Finance Ltd, as head of Asia Pacific markets including India.

Besides Saverin, who is the chairman of the firm, Velos's other founding partners include James Bailey, Raj Ganguly (not related to Samrat Ganguly) and Parminder Basran. While Bailey was an associate at GRP Partners, Raj was a VP with Bain Capital in Boston till he co-founded Velos and is also a senior advisor to The Boston Consulting Group and BCG Digital Ventures. Prior to Velos, Basran was a director at Iconic Images and was also the founding partner at Twenty Ten Capital LLP.

Velos, even though it's a global investment vehicle, will be Saverin's first major bet on India. Saverin, who was one of the five co-founders of the social networking company, had settled a dispute out of court with Facebook (which was the central plot of the movie Social Network). He was said to be owning less than 5% shares in the company worth more than $4 billion in 2012 at the time of Facebook IPO. Saverin, who made Singapore his home since 2009, had also renounced his US citizenship in 2011 ahead of Facebook listing.

Velos, which has made about half a dozen investments till now in the US, will make investments straddling between Series A and Series B in the range of $1-10 million.  "About 30 per cent or more (of the fund) would typically come to Asia-Pacific, with India and Southeast Asia being the core markets," Samrat Ganguly said over the phone from Los Angeles.

The firm is expecting to close its first investment in the country by the end of the year. "The India opportunity is incredible," said Ganguly, adding sectors like e-commerce, health & wellness, retail are looking attractive. Ganguly said that the firm would like to partner with companies which are at the intersection of consumer and technology.

The firm will look at companies which have crossed the basic thresholds such as going beyond proof of concept, generating revenues, fast growing and "at a stage where they are reaching an inflexion point".

While technology would be the underlying factor in most of its investments, Velos could also consider brick-and-mortar bets. He added that they would look at companies going beyond their domestic borders and looking at international expansion.

"Having lived in India when I was with SREI and now with significant experience in other parts of the world, we bring the best practises to table combining on-the-ground plus international experience which I think is the most differentiated aspect about us," he said.

Velos is raising its maiden $100 million fund, and has already held two closes.

Velos's investments include Silvercar, an airport car rental service, Surf Air, a California-based membership airline, Pong Research Corporation, a maker of solutions that protect mobile phone users from harmful radiation exposure, ChowNow which provides restaurants with custom online ordering tools, Twenty20, a mobile photography marketplace, and, a marketplace connecting people with everyday adventures.

(Edited by Joby Puthuparampil Johnson)