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V Raman Kumar, Founder and former CEO, MModalInc

India Infoline News Service | Mumbai |

“A number of funds are about to run their course and close in the next 2-4 years. I would say it is not a good place to be in.”

V Raman Kumar, Founder and former CEO, MModalInc – a company that he founded in 1998 and took from start up to become the world’s largest clinical documentation technology company. He sold MModal to One Equity Partners (JP Morgan’s private equity arm) in August 2012 for over 1.1 billion dollar valuation. He has won many awards including Ernst & Young Entrepreneur of the Year award for 2007 in USA. Raman Kumar is now a private equity investor, an angel and a serial entrepreneur. He has also set up his own investment company called Aeries Group to manage his India-based investments. He made his first investment in India by picking up a 20% stake in security solutions provider Zicom and is a director on its board. Mr. Kumar is now a full time private equity investor, he is an executive partner at Siris Capital Group, a New York based PE firm and his own family office - Aeries Group. He is also chief mentor at Zeus Caps. Raman Kumar sees himself as a business visionary and a futurist who has harnessed technology to achieve market leadership within a short span of 13 years. His goal is to use his skills and expertise render in his ability to take companies from start-up, mid-sized ventures to leaders in their segment


Aeris Group is the principal investment platform founded by Mr. Raman Kumar to facilitate investments in publicly listed and privately held Indian companies. It primarily manages the family funds of Raman Kumar in India. It also offers advisory services to companies requiring to raise venture and growth capital using its network of friends and high net worth individuals and family wealth offices both in India and abroad.


Replying to Anil Macarenhas of IIFL, V Raman Kumar says, “A number of funds are about to run their course and close in the next 2-4 years. I would say it is not a good place to be in.”


You have invested in Vestec. Tell us more about the artificial intelligence market. What is it all about and what is the size in India?

Artificial Intelligence and natural language processing market runs into tens of billions of dollars – the largest player in the space is Nuance, then there are others like Google, Microsoft at a smaller level. In India there is no known player that can work with Indian languages at this point – We expect Vestec to get into Indian English – Hindi to begin with and then expand to other regional languages 


How many start-ups have you invested in? Do you have a fund in India?

I do not have a fund in India, I deploy my own proprietary money into companies that I find are interesting -  Zicom, Spark Associates, Aeries technology


You had invested in Zicom. How do you see this company and industry shaping up? 

Zicom is an interesting story – the only branded security solutions provider  in India and one of the top 5 fire safety providers in the Middle East under the brand name Unisafe in UAE and Phoenix in Qatar. The industry is about to explode – I consider this to be a ten bagger in 3-4 years


What is your reading of the PE market with specific reference to investments in India?

There was a Gold rush in mid to late 2000. Many of them are stuck with illiquid investments. A number of funds are about to run their course and close in the next 2-4 years. I would say it is not a good place to be in.


What are some of the major issues PE funds face? 

Besides what I mentioned above, inexperience and too much money in the hands of too few experienced managers are among the issues.


Any expectations from the Budget/ If you had a wish list, what would it be?

As Budget 2013 nears, we must understand that apart from increasing the budgetary allocations, an absolute necessity for the Indian economy is better and timely utilisation of planned spending to avoid lapse of allocated funds, especially for social sector programmes. For improvement in infrastructure, concrete steps are required to remove the bottlenecks that hinder investments. Exports must be further enhanced by way of direct and indirect tax benefits. There also has to be a focus on restructuring the financial health of State Electricity Boards and power distribution companies. 


Allowing FDI in the retail sector was a major measure last year, and this must be followed by relaxation in the foreign direct investment caps in aviation, defence, media, banking and insurance. The External Commercial Borrowings (ECB) guidelines must also be relaxed to allow sector agnostic borrowing for CAPEX and working capital purposes. Boosting the investment climate is essential and this can be better achieved with an assurance on stability of tax regime for better tax planning. Taxability of transactions involving transfers of underlying Indian assets between Non-Residents has to become clear. Moreover, any tax decisions should not apply on a retrospective basis. An indirect tax regime with implementation of GST with clear timelines for completion of transition by the states is also eagerly awaited in this Budget. 

 

You wear three hats as private equity investor, an angel investor and an entrepreneur. Where do you see yourself spending more time?

I would like to allocate my time equally, among three roles, which I am playing


What is your next big Idea?

Wait for Vestec to launch its application suite in India – and Zicom to launch its security as a service model – both will be game changers in their respective industries.

 

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