India: Venture debt provider InnoVen disbursement up 25% in 2017 at $75m

Prior to joining Innoven, Ashish Sharma was president and chief executive officer of GE Capital, India.

Leading venture debt provider InnoVen Capital has disbursed over Rs 477 crore ($75 million) in 2017, marking an increasing of 25 per cent over its deployment a year ago.

According to a company statement, Temasek-backed InnoVen added 22 new companies to its portfolio including Blackbuck, Pepperfry, NestAway, ShopClues and Mswipe.

“The funding activity accelerated during the latter half of 2017 along with registering almost 100 per cent increase in the average ticket size in H2-2017 over H1-2017, growing to average Rs 20 crore versus the H1-2017 average of Rs 10 crore,” the company said.

InnoVen Capital has also committed facilities of $10 million taking the entire disbursement quantum to $85 million in the year across 35-40 deals, meeting its projected target of $80-100 million for FY18.

The funding in 2017 brings the total amount of venture debt extended by InnoVen India since its inception to more than $270 million, through over 165 transactions with 110 companies. 

During the year, the company also expanded its pan-Asia footprint with the launch of their office in China, after which InnoVen now has presence in India, SE Asia and China.

The company also witnessed a rise in the average funding amount and frequency on the back of return-business from its portfolio companies Oyo Rooms, Swiggy, Capillary Technologies, Rentomojo and Belong, as well as an increase in the number of deals conducted with some of the larger players in the startup space. It conducted the largest venture debt deal in the country, with Rs 100 crore to its past portfolio company, Yatra.com, breaking its previous record of Rs 50 crore that it had previously provided to Blackbuck and Oyo Rooms.

Earlier in the year, InnoVen also witnessed a shakeup in the top level management in India, when its Group COO and India CEO Ajay Hattangdi and deputy CEO Vinod Murali resigned from the firm to launch their own investment firm, Alteria Capital. InnoVen subsequently brought in former GE Capital, India, senior executive Ashish Sharma as the new chief executive for its Indian arm.

InnoVen Capital entered India in 2008 as the first dedicated venture debt provider in the country. The firm was then part of US-based Silicon Valley Bank. In January 2015, Singapore’s state-owned investment firm Temasek acquired the Indian venture debt business of Silicon Valley Bank for around Rs 280 crore.

Venture debt has grown as a means for funding for startups that are not keen to give up equity. Other players in the market include Trifecta Capital and IntelleGrow. Recently, venture capital firm IvyCap also announced its plans to launch a $76.4 million venture debt fund, while in November Unicorn India launched its $92 million venture debt fund.

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