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Mumbai-based early stage investor, India Quotient (IQ) is all set to launch an accelerator programme IQ Snipers. Through this accelerator, it would look to invest in startups at very early stages and enhance the fund’s internal deal flow.
Snipers aim to invest about INR 20 to INR 25 lakh in startups at the idea stage with a maximum 2% stake. “We will give INR 20 lakh pure convertible with a maximum dilution of 2% in case no funding is raised in six months. In case the next round is at a valuation of INR 20 Cr., we get only 1% stake. This is the 2/20 model for entrepreneurs with no conditions like liquidation preference and anti-dilution,” said Anand Lunia, partner at Indian Quotient.
Snipers will use convertible notes as their business model, which acts as loans unlike typical VC funding, where founders have to offer huge equity when they raise funding.
“In all we would invest INR 1 Cr. this year and then expand five times next year depending on the success of the programme,” said Lunia. Snipers would invest in about four to five startups annually in consumer businesses sectors such as social media, gaming, education, among others.
India Quotient was founded in 2012 by Lunia and Madhukar Sinha who was an investment executive at Aavishkar, a social entrepreneurship-focused venture capital fund. Few of their portfolio companies include Holachef, Carwale, Roposo, Care24, DogSpot, 91mobiles among others.
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