Networking giant Cisco is looking to invest $3 million to $5 million in Indian enterprise SaaS start-ups for a minority stake. The company has a portfolio of about 10 start-ups that it has already invested in directly or through investment partnerships with VC funds.
Whatfix, Videonetics, Mobikwik, Mobstac and CloudCherry are some of the start-ups in its portfolio in India.
“Globally we invest about $100 million to $200 million every year, from Series A to late-stage growth investments. There is no specific allotment to India, because we don’t operate that way. India investments may ebb and flow according to the opportunities we see in the market and the strategy we want to execute. The sweet spot for our India investments would be in the $3 million to $5 million range” said Pankaj Mitra, Director and India Head, Cisco Investments & Acquisitions.
Cisco has also made investments in Aavishkaar, a venture fund founded to promote development in rural and semi-urban India; in tech-focused start-up fund Stellaris Venture Partners; and in Chiratae Ventures.
Asked what percentage of the investment allocation is direct, he said: “You will see us make more direct investments than indirect investments. If you look at Cisco globally, we have got 120 plus active portfolio companies and 45 plus LP funds all over the world. And so, we typically steer more towards direct investments.”
The four themes
Elaborating on the four key themes that Cisco is investing in, Mitra said: “When we talk to our customers and partners, there are four areas that we’re hearing from the market, IT trends and customer trends that we have seen. The first one is what we call ‘Reimagine Applications; the second is ‘Empowering Teams’; and the third is around ‘Infrastructure’ for private cloud, public cloud, and our service provider business (Telcos). The fourth theme is ‘Security.”
On Cisco’s engagement with start-ups, Mitra said when a start-up is at a very early, pre-series A stage, Cisco Launchpad comes in. “It [Cisco Launchpad] is an accelerator where we don't take any equity in the start-up but give it technology, go-to-market mentorship and identify the problems to be solved. As the start-up scales, Cisco Investments comes in. Some of those start-ups might be interesting from an investment perspective for Cisco. Then there’s the acquisitions angle where again the stage varies. For instance, we have acquired companies like AppDynamics which was pre-IPO and Cmpute.io, which was early stage. The fourth element is a partnership where we may not invest or acquire these companies, but we can partner with them to solve market issues together.”