Rajan Anandan-backed BOV Capital sets up Rs 100-cr fund to boost Sri Lankan startups

Sri Lankan startups will now get a strong boost from BOV Capital, which has announced a Rs 100-crore fund focused on startups based out of Sri Lanka.

This first venture capital fund focused on early-stage startups in the country is a partnership between well-known investors and entrepreneurs in Sri Lanka. Google India Head Rajan Anandan is also backing the fund.

The Sri Lanka- and Singapore-based firm intends to invest in 7-10 companies, each with an investment in the range of Rs 5-10 crore, across all sectors.

The fund will invest in startups with teams that have proven product market fit and scaling plans. The fund plans to raise Rs 100 crore and has completed the first close with Rs 30 crore.

“Over the past five years, we have seen the emergence of an exciting startup ecosystem in Sri Lanka. Sri Lanka’s strong educational system has led to the country producing world-class engineers. These skills in computer science and engineering, combined with the global exposure that many of our entrepreneurs have, is leading to the creation of very interesting software product and internet companies that have tremendous regional and global potential,” said Sri Lankan investor and entrepreneur Prajeeth Balasubramniam, who is a general partner in this fund.

Mumbai-based Ambit will be the fundraising partner for the firm.

The firm will invest in and work closely with early-stage ventures, with each investment ranging from Rs 1.5 Crore to Rs 20 crores.

Sri Lanka’s startup ecosystem

Sri Lanka has been of growing interest for investors in the recent years. The e-commerce sector in the country has been steadily growing, though it is still in the nascent stages. The country’s largest trading partners are India and China, and the Chinese government had lent Sri Lanka upto $490 million in 2012.

The Indian Angel Network (IAN) had earlier invested in more than 10 Sri Lankan startups. Also, the Lankan Angel Network, which includes Rajan Anandan and the president of the Indian Angel Network, Padmaja Ruparel, had together earlier funded companies like the Lanka BPO Academy, a higher education training academy, and Nithyarn, an online store.

Recently, Silicon Valley-based 500 startups had also announced a $25 million fund aimed at investing in startups from India, Sri Lanka, and Bangladesh. The fund plans to invest in sectors across fintech, edtech, health and wellness, data analytics, content and SaaS and SMB.

The other known investor firms who have invested in Sri Lankan startups include Sequoia, ePlanet, Nexus Venture Partners, Nasscom, and Naspers, amongst others.

A few of the rapidly growing startups in Sri Lanka are wow.lk, an e-commerce portal, ikman.lk, an online marketplace, YAMU, a search portal for food joints, Takas.lk, and MyDeal.lk, e-commerce portals.