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Zone Startups India Backed By Ryerson Futures Joins India's Early Stage VC Funding Club

Zone Startups India Fund has a corpus of Rs 190 crore and has been backed by Toronto-based Ryerson Futures, the technology accelerator and investment arm of Ryerson University and the Chokhani Family office.

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A slew of early-stage funds have been launched since the start of 2017. It seems to be to be a tide that will bring in change and accelerate the investment deals in the startup ecosystem. The latest to join the club of new  early-stage venture capital funds is private accelerator Zone Startups India.

Zone Startups India Fund has a corpus of Rs 190 crore and has been backed by Toronto-based Ryerson Futures, the technology accelerator and investment arm of Ryerson University and the Chokhani Family office.

The fund is expected to be raised from Indian institutional accounts.The first close will happen in the next two to three months or be the FY-17, confirms Ajay Ramasubramaniam, director of Zone Startups India.

The Alternative Investment Fund is looking to  build a portfolio of 8-15 companies over the next 12 months. While the fund will conduct deals with ticket sizes ranging from Rs. 50 lakh to Rs 3 crore, the sectoral preference will remain core technology.

The focus of the fund will be software companies, especially with eye on mobile technology and enterprise tech. Also, B2B is another big focus along with B2C companies with a proven track record and (those that) have already raised one round of funding.

Reversing 2016's early trend, the first quarter of 2017 saw angel and seed investments fall both in volume and value terms with deal volumes reduced to half. January-March 2017 alone saw 120 deals, compared with 245 in the same period last year with Series-A funding slumping 65% in deal value on a YoY basis.

Beyond its micro venture capital fund, Zone Startups India has also received a grant of Rs.10 crore from the government's Department of Science and Technology to invest in 10-15 companies that are part of its accelerator program over the next year. Early-stage companies that are part of the accelerator, the ticket  sizes would span from Rs 30 lakh to Rs 1 crore.

First time in the history, a grant by the government has been made by a private accelerator in India. As a revolving, or green fund, this smaller Rs 10 crore corpus will be invested on a recycle-and-use basis  through its 2-5 year life span. Companies can tap into this corpus  either for equity or debt depending on their use case


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