SVB begins venture lending in India
Namitha Jagadeesh -
Monday, August 18, 2008 6:02 PM
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SVB Financial Group, the parent of Silicon Valley Bank, has obtained regulatory clearances to launch venture lending operations in India. The firm, which was awaiting a non-banking financial company license from the RBI, will operate the business through its wholly-owned subsidiary SVB India Finance Pvt Ltd. Ash Lilani, who heads the group's international businesses, will act as CEO and Ajay Hattangdi will be managing director. SVB is the first institution to offer venture lending to Indian companies.
Mint had first reported SVB's venture lending plans last October. The concept of venture lending is to provide debt capital to VC-backed companies, typically for physical assets. SVB estimates the proportion of debt to a third of the equity. "People are buying office space and equipment (using venture capital), when equity should really be for the growth of the company," Lilani had told me in an earlier interview. Initially, it will work with VC funds here familiar with venture lending. It has previously co-invested in deals with funds such as Sequoia Capital India, Mayfield Fund, SAIF Partners and Canaan Partners out of its $54 million fund SVB India Capital Partners Fund.