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| Venture Capital |
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Inspite
of the recession
today, the venture
capitalists are still
investing, the reason
being the fact that
now is a much less
distracting time than
12 months back -
lesser noise, lesser
competition, and
lesser irrationality.
This is especially
true in areas where
the customer demand is
unaffected - for
technology-oriented
businesses, this means
more of consumer
internet, mobile VAS,
education and
healthcare businesses.
And perhaps less of
software products and
offshore services,
even though specific
industries there
continue to do well. |
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Venture
capital (also known as VC or
Venture) is a type of
private equity capital
typically provided to
early-stage, high-potential,
growth companies in the
interest of generating a
return through an eventual
realization event such as an
IPO or trade sale of the
company. Venture capital
investments, generally made by
institutional investors, in
exchange for shares in the
invested company, are expected
to bring managerial and
technical expertise as well as
capital to the investments.
WVCL investments are usually
made for new companies with
limited operating history that
are too small to raise capital
in the public markets and are
too immature to secure a bank
loan or complete a debt
offering. In exchange for the
high risk that venture
capitalists assume by
investing in smaller and less
mature companies, they usually
get significant control over
company decisions, in addition
to a significant portion of
the company's ownership (and
consequently value). Needless
to say, the bar for start-ups
to raise capital has gone up.
Capital is more selective
today than it was few months
back. Besides a stricter
industry selection as
mentioned below, the premium
on capital efficiency of
businesses has gone up as a
selection criterion.
Webel
Venture Capital (WVCL)
is engaged in making
investments primarily in
equity and related instruments
in entities engaged in the
sunrise Electronics, Telecom
and Information Technology
industry which also includes
networking, data
communication, software
development, multimedia,
internet services and value
added telecommunication
services. The main objective
of WVCL is to provide
financial assistance through
investments, in order to
assist and further the rapid
growth of this industry
segment, thereby enabling
innovation related companies
to develop and maintain a
niche position in the national
and international arena. The
Fund aims at providing a type
of private equity capital
which typically delivers
financial assistance to the
early-stage and high potential
growth companies, with the
intent of generating a return
through an eventual
realization event. Any
unlisted company ( Public /
Private ) registered under the
Companies Act 1956, seeking
funds for projects in areas of
Information Technology,
Electronics,
Telecommunication,
Semiconductor or
Nano-Technology are eligible
to apply for financial
support. |
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| Project
selection process: |
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Webel
Venture Capital Ltd
(WVCL) asks the
entrepreneurs to
submit the Detailed
Project Report (as per
prescribed format) for
appraisal. |
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The
Project Report is sent
to IIT Kharagpur for
preliminary technical
appraisal |
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Based on recommendation/ Reports of IIT KGP, the
Project Report is
placed before the
Screening Committee of
WVCL and the
entrepreneurs is
advised to give their
presentation before
the Screening
Committee Members. The
Members of the
Screening Committee is
comprised of the
following persons: |
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| S.No |
Name |
Designation |
| 1. |
Shri Siddharth, IAS, Principal Secretary, Dept. of IT GoWB |
Chairman |
| 2. |
Dr.
Basudeb Sen |
Member |
| 3. |
Dr.
Dhrubes Biswas,
Working Chairman
of WVCL |
Member |
| 4. |
Shri Tamal Dasgupta, Managing Director WBEIDC LTD |
Member |
| 5. |
Shri Apurba
Ratan
Chakraborty IAS,
Joint Secretary,
Finance Deptt
& Director
of Treasuries
& Accounts
Govt of W.B. |
Member |
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On
acceptance of the
Project Proposal by
Screening Committee of
WVCL the Project
Report is sent to the
External Consultant
[West Bengal
Consultancy
Organisation Ltd
(Webcon)] for
appraisal of the
Project Proposal. |
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Based
on recommendation/
Report (for funding)
by the External
Consultant (Webcon), a
Due Diligence exercise
is done by an external
expert/ consultant
(appointed by WVCL). |
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Thereafter
the approval of MIC IT
is obtained for
funding the Project
Proposal. |
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After
obtaining the approval
of MIC IT, a Share
Subscription &
Investors Right
Agreement is signed
between the concerned
V.C Unit and WVCL. |
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After
signing of the Share
Subscription &
Investors Right
Agreement with the
concerned V.C Unit and
based on the
projection submitted
by the V.C Unit, fund
is disbursed (in
phases) by WVCL to the
V.C. Unit. |
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| Currently
five companies have been
provided funds by WVCL in
areas of RFID tags with
sensors, Data Leak prevention,
Cellular based applications,
System solution for advanced
video analytics system and
power factor correction.
Funding is in the form of soft
loans and equity. The
investing cycle for most funds
is generally three to five
years for a business start-up,
usually in exchange for
convertible debt or ownership
equity, after which the focus
is managing and making
follow-on investments in an
existing portfolio. WVCL
provides capital after
establishing an escrow account
and after conducting a
post-money valuation to
determine how much equity to
demand in return for the
finance injection to an
entrepreneur. For WVCL the
focus however is not only in
the financing element aimed at
long term capital
appreciation, but also
engagement, advice, coaching
and everything else that goes
into enabling
entrepreneurship. In the
final analysis, WVCL continues
to energise the ecosystem by
being a more effective
matchmaker and guide to the
aspiring talent in Bengal. |
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