• Mayfield Adds MD With India Chops, Has First Fund XII Exit

By John Letzing 9/6/2006 - VentureWire

Silicon Valley venture capital firm Mayfield Fund has added its third new managing director in the past year, hiring Navin Chaddha away from Gabriel Venture Partners.

Chaddha, who assumed his new position Tuesday, comes to Mayfield after a string of India-based successes at Gabriel Venture Partners. He led Gabriel Venture Partners' investments in financial services provider IL&FS Investsmart Ltd., telecommunications services provider AllSec Technologies Ltd. and retailer Provogue Ltd., all of which went public on the Bombay Stock Exchange in the last year and a half.

Mayfield Managing Director Yogen Dalal said that while Chaddha will be sourcing deals internationally, "he's one of the most successful venture capitalists doing deals in India," and Dalal is hoping that Chaddha can now bring some of those India deals to Mayfield. Chaddha estimated that he will be traveling to India roughly once per quarter, the same rate at which he visited the country while he was a managing director with Gabriel Venture Partners.

It was Mayfield's reputation as one the premier venture capital firms in Silicon Valley that drew Chaddha away from Gabriel Venture Partners, he said. "They have a great platform and a great legacy," Chaddha said, adding that Mayfield has had more than 100 of its portfolio companies offer shares to the public since it was founded in 1969.

A personal relationship also drew Chaddha to Mayfield - Dalal said that he's been keeping tabs on 36-year-old Chaddha since he was a graduate student at Stanford University roughly ten years ago. Back then, Chaddha was forming video compression technology company VXtreme Inc., which was eventually sold to Microsoft Corp. in 1997.

Chaddha becomes Mayfield's eighth managing director. Roughly one year ago, at the time Mayfield closed its most recent fund, Mayfield XII, at $375 million, it added Raj Kapoor and James Beck as its sixth and seventh managing directors. Managing Director Peter Levine had departed earlier in the year.

While closed only last year, Fund XII has already seen its first exit with the sale of virtualization technology developer Akimbi Systems Inc. to VMware Inc. in June. Dalal said that while Akimbi, founded in 2004, had raised "around $8 million" in funding, it was sold for a sum "in the neighborhood" of $59 million. Dalal said that Akimbi's technology was such a good fit for EMC Corp.-owned VMware that the company pursued Akimbi early and aggressively.

"We'll take the IRR," Dalal said, referring to the rate of return resulting from the investment. "It's always nice to show your limited partners that you're making money for them."

While Dalal stressed that Chaddha will have the same international outlook of any other Mayfield managing director, his hiring comes at a time when many Silicon Valley firms are forming strategies to tap the burgeoning Indian market. Some firms, like Sequoia Capital, have absorbed or partnered with India-based venture capital firms to get a foot on the ground there.

But while Mayfield is taking such an approach with China, through its investment in Beijing-based GSR Ventures, Dalal said Mayfield will continue to invest in India from its base in the U.S. for now.

Chaddha said he believes the most intriguing domestic Indian markets are retail, financial services and telecommunications. "With Navin on board we have the added advantage of knowing what's going on there," Dalal said.

Dalal said that despite adding a new managing director, Mayfield will continue to target roughly 12 investments per year from Mayfield XII.