Sequoia, Singapore fund may invest in Excelsoft

Mysore-based e-learning firm valued at Rs 350 cr.

Sequoia Capital and a Singapore-based private equity fund are learnt to be in the race to invest upwards of Rs 100 crore in Mysore-based e-learning firm Excelsoft.

Excelsoft is a six-year-old firm which provides a range of customised learner-centric learning systems, test and assessment systems, and desktop tools.

According to industry information, the company, which has a topline of around Rs 50 crore is expected to be valued in the range of Rs 350-400 crore for the stake sale. A deal is expected to be sealed by early-January 2008.

Industry sources further indicate that in addition to Sequoia and the Singapore fund, ICICI Venture is also in the fray to invest in this high-margin firm.

Estimates are that Excelsoft has a net profit of close to Rs 25 crore due to its business model of taking the product licensing route on which services and consulting add value and stickiness.

"Excelsoft has created intellectual property in the area of e-learning technologies and combines its strengths in software development, instructional design and e-learning content development to deliver e-learning solutions," said an industry source.

Excelsoft presently employs around 500 people across Mysore, Hyderabad and New Delhi, and serves a marquee of clients from global educational publishers, universities and corporates.

A few of the clients of the firm are Pearson Education, Infosys Technologies, Indian Institute of Foreign Trade, Oxford University, World Bank, UNESCO besides a clutch of others. Excelsoft, off late, has been keenly focussing on the test and assessment platform which are key enablers for universities.

Sequoia Capital India, the India arm of the global private equity and venture capital fund, recently raised its third venture capital fund with a corpus of $300 million taking its total funds under management in India to $1 billion.

Sequoia India's fresh corpus of $300 million catapults them into a league as among India's largest venture capital funds along with Matrix Partners who manage close to $450 million for investments in high growth early-stage companies across sectors.

Sequoia Capital India has been one the most active investment firms in India and has invested in over 35 companies over the past seven years, including in companies such as Applabs, Bharti Telesoft, Café Coffee Day, FirstSource, GlobalLogic, Idea Cellular, Indecomm and SKS Microfinance.