Dave McClure-led, California-based early-stage seed fund 500 Startups, has reportedly deferred its plans to raise a $25 Mn India-focussed fund, called 500 Kulfi. The reasons for holding it off have been cited as taxation and regulatory concerns, as per a report by ET.
500 Startups was founded in 2010 by PayPal & Google alums, and its startup accelerator has accelerated over 1,500 startups across 30 countries with a series of micro-funds being launched. It has made more than 50 investments in India.
“Due to recent moves by the Indian government regarding tax and regulatory environment, our India fund is on hold temporarily, until we have more clarity,” an official spokesperson from 500 Startups told ET.
When announced in February 2016, 500 Kulfi was described as a fund focussed upon early-stage companies with product-market-fit and demonstrated traction. Although the fund is sector-agnostic, it will focus on startups from sectors including fintech, edtech, health & wellness, data analytics, content, and SaaS/SMB.
Prior to this, in January 2016, 500 Startups was reported to hold up plans for its India-focussed startup fund StartupWallah. “However, 500 Startups will continue to actively invest in India in 2017 and will be announcing three-four new investments here in the first quarter,” the spokesperson added.
500 Startups has been active in India and invests in 15 startups a year with the investment ranging from $50-500K. In India, it has invested in about 50 startups including MyChild, POPxo, Origa Leasing, Tripoto, Quickli, LafaLafa, OnlineTyari, Qustn, TradeBriefs, Instamojo, Sheroes.in, gazeMetrix, and ZipDial. It has also backed price comparison startup PriceBaba, through its India based fund StartupWallah.
In October last year, it also organised a one day workshop focussing on the Indian startup hardware sector, Blueprint: The 500 Hardware Workshop. Startups including InnovAccer, Tourlandish (now called Headout), Sourceasy, and TargetingMantra have been a part of the 500 Startups accelerator programme.