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One97 & SAIF Partners Launch $100 Million Mobility Fund

One97 Communications*, a mobile Value Added Services company preparing for an IPO and SAIF Partners, one of its investors, have together committed $100 million investment fund for co-investing in mobile value added services companies. The fund, called the One97 Mobility Fund, will look at a ticket size of $0.5M-$5 million in early stage investment. One97 MD Vijay Shekhar Sharma told MediaNama. “We don’t mind picking up even 10% stake, but we’re not likely to take a majority stake. We want to give entrepreneurs the freedom to build their business. We’re looking at early stage companies. I had a problem when I started up, when I had to hunt for a few lakhs of rupees in investment. We’ll provide capital, access to go to market, staffing, even tech help where they need it.” Sharma and Ravi Adusumalli of SAIF Partners will take calls on the investments.

Sharma said that the company wants to take a leadership position in this space, because he feels that “innovation will take a leap once data connectivity in India explodes. This is the right time for entrepeneurs to get into telecom applications space, whether iphone apps, media content, distribution, applications related to education, health, commerce, location based services, mobile advertising…” The fund will focus on investments in companies from the South Asia region.

But what of the companies which the fund invests in? What’s the exit route? Sharma says that will depend on the company – they’ll be free to even merge with One97’s competitors. Two companies that One97 Communications invested in/incubated have been moved into the One97 Mobility Fund: TenCube (which owns the phone security and backup product Wavesceure), which One97 Communications acquired less than 25% in, as well as Oorja, which it incubated.

Other enterprises which target the mobile value added services space specifically for investment are competitor OnMobile, which has its OnMobile Developer Network (ODN), and customer Bharti Airtel which has an Airtel Innovation Fund that is yet to make a single investment a year and a half after being announced. Ver Se Innovation, part of the OnMobile Developer Network had raised further investments from Matrix Partners.

SAIF Picks Up 10% More In One97 Communications

Meanwhile, VCCircle reports that SAIF Partners has picked up 10% more stake in One97 Communications at $10 million, valuing the company at  – around 7.5% from One97 Communications’ initial investor Peeyush Aggarwal, and the rest from Sharma, taking its investment to 41%.

* Disclosure: One97 Communiations had sponsored MediaNama’s coverage of the 3G and Broadband Wireless Access results.

– Bharti Airtel Sets Up $44 M Telecom Fund; Deals Capped At $4.4 M; Read The Fine Print
– One97 Communications Files DRHP; To Raise Rs. 120 Crores; Shareholding, Financials

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