BTS Private Equity, India
SIFEM investees
Swiss Technology Venture Capital Fund (Private) Limited ("SwissTec") and BTS India Private Equity Fund ("IPEF")
SIFEM investments
SwissTec - USD 21.5 million; IPEF - USD 12.0 million (all investments into fund equity)
The Swiss Technology Venture Capital Fund (SwissTec), an early growth stage fund wholly owned by SIFEM, was a pioneer project to contribute to the sustainable development and growth of the small- and mid-cap private equity market in India. It was launched amidst the Asian financial crisis in 1997-98, when India was still a priority country of the Swiss development cooperation, and international capital flows to India had virtually dried up.
Unfortunately, SwissTec's initial management team did not deliver the expected performance, and a decision to remove it was taken in 2000. SIFEM's team worked closely with the fund’s middle and junior management to establish a new fund management company, and help them acquire requisite skill set and networks. In order to improve the structuring, sourcing and network of the new fund management company, SIFEM selected an India-specialized Swiss investor group as joint-venture partner for the fund manager. To assure a smooth transition, SIFEM held a minority stake in BTS, the new management company, and actively contributed to its build-up and strategic positioning.
Since four out of six SwissTech investments made between 1997 and 2000 were complete write-offs, SIFEM also worked with the new management team to redefine the investment strategy. BTS successfully repositioned itself in the underserved small and medium enterprise (SME) growth capital market, making thirteen new investments which are now in the final realisation phase expecting to return over 2.5x invested capital. This has proven that providing growing SMEs in India with risk capital can be economically viable while sustainably creating new jobs. Three of the portfolio companies have won prestigious ICICI-CNBC “Emerging Company of the Year Award” in their respective sectors.
This success has enabled BTS to raise a follow-on fund, the BTS India Private Equity Fund. SIFEM sold its stake in the management company to avoid conflicts of interest, and seeded the fund with an investment of USD 12 million. The fund closed at over USD 73 million in 2007, and has so far invested in seven growing SMEs. The investment by BTS has enabled these companies to scale their business models, secure around 4,000 existing jobs and create over 600 new jobs in the first two years of investment.
Swiss Technology Venture Capital Fund (Private) Limited ("SwissTec") and BTS India Private Equity Fund ("IPEF")
SIFEM investments
SwissTec - USD 21.5 million; IPEF - USD 12.0 million (all investments into fund equity)
The Swiss Technology Venture Capital Fund (SwissTec), an early growth stage fund wholly owned by SIFEM, was a pioneer project to contribute to the sustainable development and growth of the small- and mid-cap private equity market in India. It was launched amidst the Asian financial crisis in 1997-98, when India was still a priority country of the Swiss development cooperation, and international capital flows to India had virtually dried up.
Unfortunately, SwissTec's initial management team did not deliver the expected performance, and a decision to remove it was taken in 2000. SIFEM's team worked closely with the fund’s middle and junior management to establish a new fund management company, and help them acquire requisite skill set and networks. In order to improve the structuring, sourcing and network of the new fund management company, SIFEM selected an India-specialized Swiss investor group as joint-venture partner for the fund manager. To assure a smooth transition, SIFEM held a minority stake in BTS, the new management company, and actively contributed to its build-up and strategic positioning.
Since four out of six SwissTech investments made between 1997 and 2000 were complete write-offs, SIFEM also worked with the new management team to redefine the investment strategy. BTS successfully repositioned itself in the underserved small and medium enterprise (SME) growth capital market, making thirteen new investments which are now in the final realisation phase expecting to return over 2.5x invested capital. This has proven that providing growing SMEs in India with risk capital can be economically viable while sustainably creating new jobs. Three of the portfolio companies have won prestigious ICICI-CNBC “Emerging Company of the Year Award” in their respective sectors.
This success has enabled BTS to raise a follow-on fund, the BTS India Private Equity Fund. SIFEM sold its stake in the management company to avoid conflicts of interest, and seeded the fund with an investment of USD 12 million. The fund closed at over USD 73 million in 2007, and has so far invested in seven growing SMEs. The investment by BTS has enabled these companies to scale their business models, secure around 4,000 existing jobs and create over 600 new jobs in the first two years of investment.