Cambridge Technology Enterprises, a Hyderabad-based technology services company, will launch a special fund for an early-stage investment in US-based start-ups, to tap into emerging technology and innovation, while at the same time address its core problem of getting employees trained in new technologies, said company chairman.
“It’s like Cambridge Technology Enterprises incubating its own clients,” Aashish Kalra, chairman of Cambridge Technology Enterprises told the Financial Express. “We want to get them faster to Series-A funding,”Kalra said.
As per plans to be made public on Wednesday, the Singapore-based Cambridge Technology Fund, a wholly-owned subsidiary of Cambridge Technology Enterprises, will purchase upto 25% equity in the start-ups as a seed funding, help them with a 2-year technology plan and also provide a product team to work on their plans, he said.
The fund – Cambridge Technology Fund – will invest in 12 start-ups in the next 15 months, he said. It has already invested in three start-ups. Overall, the company has set aside $3 million for the initiative.
The move augurs well for the Cambridge Technology Enterprises as it will make money when its equity is diluted or bought out by other investors, its own employees will have an advantage to work on latest technology and innovative products and solutions, while the Indian-company will get a contract apart its funding to the start-ups, he said.
Cambridge Technology will focus on US-based start-ups since the valuations are low, and the products come with innovation and global appeal, apart from the exit valuations being high, he said.
Kalra, a serial-enterpreneur himself says his company has a high degree in ensuring that the selected start-ups succeed given his past experience of building start-ups and exiting since the past two decades.
“We believe we have a better ability of deal selection,” he added.
On the broader business, Cambridge Technology aims to have monthly revenue of $1 million until March 2016, and is targeting to double the billing to $2 million in monthly revenue by March 2017, Kalra added.