"We have launched the fund which will invest in very early stage companies, which will give us disproportionate access to evolving technology," company's Chief Operating Officer Mrityunjay Singh told PTI.
"We are doing idea investing and not investing in a business model," he said, adding the fund will act more like an angel fund.
He said the company is targeting to invest in up to 40 start-ups through the fund and has already invested in five start-ups from within the country as well as outside, especially in the in US and Israel.
Singh said if the investee company is doing good, it will command a high valuation for a complete acquisition by Persistent, while in the opposite case where it is doing bad, Persistent may not want to acquire it.
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It can be noted that with fast changes in the landscape, many IT companies have increased their engagements with the fledgling start-up world.
IT bellwether Infosys has created a USD 500-million innovation fund, while its larger rival TCS has associated with an accelerator called Startupbootcamp to have pitch days in the financial capital and Bangalore.
When asked if the size of the fund, at USD 10 million, is enough, Singh said that given the size of the Pune- headquartered company, he finds it sufficient.
He said that the company will be keenly looking at acquisition opportunities to achieve targeted USD 1-billion in revenues in the next three to five years.
"We are at around USD 320 million at present and will have to grow both organically as well as look at inorganic growth opportunities to achieve the target," he said, adding that it will not do acquisitions just for the sake of it but to get to the next level.