Kanwal Rekhi, an angel for more than a decade, is launching a venture fund and is meeting with institutional investors. He hopes to raise $150 million to $175 million for his inaugural fund.
The firm, Inventus Capital Partners, will be based in Silicon Valley and Bangalore, India. In launching a venture fund, Rekhi is joined by two other investors — Managing Directors John Dougery Jr. and Samir Kumar.
Rekhi was long a media darling after heading up The Indus Entrepreneurs, or TiE, an influential Indian networking group. He also was the founder of the computer networking company Excelan, which went public in 1987. Dougery was most recently a venture partner with BA Venture Partners, while Kumar was a managing director at Jumpstart, a VC fund in India. Kumar, who headed India operations for Acer Technology Ventures, is in Bangalore, where he is identifying investments for the team.
All three partners plan to focus on consumer Internet, software, wireless and other software-as-service-type companies, largely in India.
Asked for more specifics, Rekhi says, “I really can’t talk about it—lawyers’ orders. We have to be careful not to promote ourselves.” In fact, Inventus doesn’t have so much as a website.
But what is known is that Rekhi’s friendship with Dougery dates back many years. Dougery’s father was one of Excelan’s venture investors. The younger Dougery was a product manager at Silicon Graphics before joining BA Ventures and had led investments for his former employer in chip companies Ageia Technologies and Astute Networks, both of which remain privately held.
He was also involved in Web application security software developer Teros, which raised more than $33 million from New Enterprise Associates and CMEA Ventures, and sold for an undisclosed amount to Citrix Systems in November.
Rekhi has been an angel investor for more than 10 years. Most recently, he, along with about 10 other individual investors (including Dougery), invested in an as-yet-undisclosed Series A round for Santa Clara, Calif.-based Kaboodle, which is attempting to simplify the process of collecting, organizing and sharing information like product prices.
In years past, in addition to taking early stakes in data center outsourcer Exodus, which went public in 1998, and the comparison shopping site NexTag (still privately held though profitable), Rekhi invested in the EDA company Ambit Design, which raised $18 million from investors and was bought for $260 million in cash by Cadence Designs Systems; and Zeitnet, a maker of ATM adapters that raised $6 million in capital and was acquired by Cabletron for $140 million.
Rekhi, who was said to be worth more than $500 million according to a Fortune magazine story in 2000 called “The Indians of Silicon Valley,” says that he has invested in more than 50 companies.
He was especially active when he first began to invest as an angel in 1995.
That was the year that he left Novell, which had purchased Excelan in 1989 for $210 million and made Rekhi its CEO.
“I backed seven startups in 1995 alone and they all paid off,” he crows.
In discussing why, with his track record, Rekhi is bothering to raise a venture fund, he says, “Angels were really wiped out in the pay-to-play phenomenon of several years ago. That’s when I started talking about early stage VC stuff with John.”