<div>Think of it as adventure capital; when capital flows are down, private equity is taking a back seat, and venture capital firms are being careful, one category of investors is still willing to take risks: the high net worth individuals or HNIs. Either singly, or in combination with others of their kind, HNIs are still chasing high risk and high rewards by putting their money into small, unlisted companies. <br /><br />Granted, the number of such investments may just be a tickle now, but according to some market observers, a pipeline is building up quickly. Take Just Recharge It, a an online mobile recharging company that some HNIs found as an attractive investment; another similar unnamed company is aslo reported to be exciting HNI interest.<br /><br />And it's not just telecom services or small IT servies companies; SK Auto Finance, a Jaipur-based company is yet another that appears to draw HNI money. “Today, few venture capitalists and private equity players would invest Rs 10-50 crore in such firms," says Deepak Ladha, executive director, Ladderup, a corporate advisory firm that also doubles up as investment vehicle for its promoters. "Such deals are increasing but often go unnoticed because of their size.” Ladderup has also invested in some companies along with some HNIs.<br /><br />Then there is the perennial HNI favorite: real estate. In past years, HNIs bought apartments or shops in real estate projects, as small-ticket investments, but now, they are buying equity in entire development projects, mostly through special investment vehicles, or SPVs. At a time when projects are facing financing pressure, HNIs are stepping in and negotiating for pieces of the action -- and hard. One recent example cited by some analysts is Lotus Spaces in Mumbai.<br /><br />Ladha says that the advantage HNIs have is having a say in the project, similar to what private equity firms had. From putting their money into PE funds that invested in such projects, HNIs are replacing the PE firms. As one wise man is supposed to have said, in stormy seas a ship may be safe in the harbour, but that's not what a ship is meant for. HNIs seem to have taken that to heart, and are navigating the high-risk seas themselves. <br /><br /><br />sachin.dave(at)abp(dot)in<br />sachin581(at)gmail(dot)com<br />Twitter: (at)sachin(underscore)vd<br /> </div>
