Japan’s Softbank enters into Indian venture capital

Softbank Investments, the venture capital arm of a Japanese financial group, is launching a fund in India with a local partner, SBI Capital Markets, a subsidiary of State Bank of India.

Softbank Investments, the venture capital arm of SBI Holdings, a Japanese financial group, and SBI Capital Markets, the investment banking subsidiary of the State Bank of India are raising a $100 million venture capital fund.

The fund will make investments of between $5 million and $10 million in sectors as varied as business outsourcing, life sciences and environmental technology.

The India venture fund marks a first for both Softbank and its Indian partner.  Yoshitaka Kitao, chief executive officer of Softbank said: “Our fund with SBI is only a first step…We will soon be making some important – even historical – long-term announcements about our comprehensive India strategy.”

Sri O.P. Bhatt, State Bank of India’s chairman, said the alliance with Softbank is a “small but significant step” toward venture capital.

State Bank of India is the country’s largest bank. Softbank Investment manages 18 venture capital funds. Last year it collaborated with Singapore’s Temasek Holdings to launch a $100 million China-focused venture fund.