The apex industry body for alternative assets - the Indian Venture & Alternate Capital Association (IVCA) - on September 21 announced the new eight member VC Council for 2022-24 led by Sequoia India & Southeast Asia and Surge MD Rajan Anandan as the chair. The council will be co-chaired by Rahul Khanna, co-founder and managing partner, Trifecta Capital.
Other members include Manish Khetarpal (WaterBridge Ventures), Priyanka Chopra (Bharat Innovation Fund), Ruchi Khajanchi (A91 Partners), Sehraj Singh (Prosus Ventures), Anil Joshi (Unicorn India Ventures), and Sameer Brij Verma (Nexus Venture Partners).
The council is a permanent sub-committee under the aegis of IVCA Executive Committee. The new VC Council aims to drive government engagement by advocating policies that encourage innovation which contributes to capital creation, nation building and knowledge dissemination. To achieve the same, the council is looking at training and supporting young fund managers, creating a governance playbook and also working towards building a gender-agnostic approach in the VC community.
“The startup ecosystem and the venture capital industry in India are entering a new phase. India is already the third largest start-up ecosystem in the world and has become a preferred destination for investors from around the world. Our mandate as the VC council is to ensure that we continue to build on these strong foundations while addressing a range of areas such as attracting more domestic capital, improving governance, and encouraging new funds in emerging sectors,” Rajan Anandan, MD, Sequoia India & Southeast Asia and Surge & Chair, VC Council, IVCA, said.
Rahul Khanna, co-founder and managing partner, Trifecta Capital, and co-chair, VC Council, IVCA, said, “It’s a privilege to co-lead the VC Council of the IVCA…My aim in the new role will be to support the maturing of this asset class by providing access to best practices in capital formation, portfolio management, governance and reporting. This should particularly benefit my peers in the venture capital community especially, the emerging local managers who are helping fund growth and innovation in the Indian economy.”
The Council is working on a governance playbook. As per IVCA’s internal data, the average age of Indian startup founders is 28. This suggests less than a decade of work experience and limited expertise in legal and finance matters. In addition to this, startups need to adhere to compliance, corporate governance, and strict framework of protocols irrespective of the scale.
This discussion becomes especially important given the several governance and management lapses seen across prominent start-ups like BharatPe and Zilingo in 2022.
“Moreover, Board meetings when run efficiently plays a critical role in setting the momentum for not only the start-up but also for its investors. At IVCA, we are committed to support the entrepreneurial activity and innovation while maintaining high standards of ethics, business conduct and professional proficiency. Thereby, we believe the playbook will be one of the many measures which will be helpful in laying down the best practices long with checks and balances in place for entrepreneurs, startups and investors run successful businesses,” an IVCA spokesperson told Moneycontrol.
The previous VC Council too had led delegations for virtual meetings with government entities such as the Ministry of Commerce & Industries, DPIIT, SIDBI, IRDAI, MoLE, LIC, among others. It was at the forefront of spearheading startup and VC events, webinars and knowledge workshops.
The IVCA will also be hosting masterclasses for fund managers which deal into tax, compliance, regulatory issues as well as other contemporary topics relevant to PE-VC ecosystem. “A monthly series of masterclasses was started to support the portfolio companies of our member funds. With the new VC Council in place, this cause will witness a fresh perspective and direction. Going forward, IVCA plans to organise knowledge sessions for young and upcoming first-time fund managers,” the spokesperson added.
Bringing gender diversity
The sector continues to witness an explosion in venture-backed companies. There has also been a rise of Micro VCs (active fund size of less than $30 million) which looks promising as the new investors/ fund managers provide capital as well as mentorship to their portfolio companies. As per Venture Intelligence & IVCA analysis, from 2017 till date, there are around 140 active domestic fund managers, of which around 34% are First Time Fund Managers.“With new trends emerging in this space and to mirror the socio-economic changes, we at IVCA are cognizant of the skewed gender ratio in India and globally. Thereby, we have created an effective diversity and inclusion strategy which has been acknowledged by our Executive Committee,” the IVCA spokesperson said.