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Mangrove invests $250 million in India's e-commerce, internet and telecom startups

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Mangrove invests $250 million in India's e-commerce, internet and telecom startups

29 Jun 2015

(The venture capital fund…)

NEW DELHI: Mangrove Capital Partners has come knocking with a $200-250 million corpus to invest in India's e-commerce, internet and telecom startups, a partner Michael Jackson at the Luxembourg-based venture capital fund said.

"India is going to be a fantastic market for us because there will be millions of people getting on the internet. Second, only local technology and local solutions can resolve local problems," Michael Jackson told ET.

The venture capital fund will look at investing in companies that offer disruptive models in the e-commerceand telecom space, for an investment period of 5-10 years, he added. Mangrove has already invested $5-10 million in Store King, which offers e-commerce platform to retail stores that double up as grocery stores in the tier-3 and lower towns in Karnataka, Tamil Nadu, Andhra Pradesh and Kerala.

Offering the hybrid retail concept, for which the company had filed a patent, Store King installs kiosks or tablets in small town shops using which customers can shop up to 50,000 products online either on their own or with assistance. While customers pay in advance, the shop owner ensures that the products reach them the next day, thus saving on large inventory costs. "I feel e-commerce is the natural way of buying products and I see great potential in India as there are a lot of people who are yet to make their first e-commerce transaction," Jackson said.

Mangrove started out in 2000, focusing on early-stage information technology companies and has since invested in over 70 startups across Europe, Israel and Russia. It currently manages assets of about $1 billion in four funds that invest in and guide small entrepreneurs, who need capital to grow.

With initial ticket sizes of $5-10 million each and investment cycle of about five to 10 years, Mangrove increases the fund size as the company grows. It has invested about $25 million in three tranches in Danish messaging app maker Nimbuzz, which was 70 per cent acquired by the UK-based New Call Communications for $170 million in October last year.