Dream Capital will focus on sports, gaming and fitness technology startups in their early stages.
The development comes at the back of the Mumbai company, already adding new avenues to the portfolio as it diversifies beyond being an online fantasy gaming platform.
“We want to redistribute our Ebitda and invest more in inorganic growth, because as long as organic growth continues, we don’t want to fall into that long-held trap of trying to do everything ourselves,” Harsh Jain, founder and CEO of Dream Sports told ET he said in a. The idea is to build a global ecosystem of sports technology through this initiative and support many startups, he added.
Ebitda represents interest, taxes, amortization and earnings before amortization.
“We have something good, and we will continue to grow that. What we want is to support entrepreneurs and invest in other creators …,” Jain added.
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The company is open for minimal investment and shopping, he said.
Dream Capital will cut checks worth $ 1 million or more and have the capacity to plow $ 100 million, God said.
For now, the corporate venture capital fund will invest about 20 startups over a 12- to 24-month period with the potential to generate annual revenues of at least $ 100 million over five years.
“We started this as an experiment with Dream Sports Investments – like FanCode, like Dream Pay.” We learned that we didn’t want to go after too much incubation and that we wanted to support activists who had already spent a few years of their lives solving a problem … ”God told ET.
Dream Capital is the result of previous investment studies, he said.
Dream Sports will fund the entire fund from its balance sheet and has already made about eight investments. The group recently announced a $ 50 million investment in the FanCode content and commerce it incubated.
Last month, the Supreme Court ruled that Dream11’s fantasy sports format was a “skill game” in response to a special request for alleged permission to play.
“Even if the trial is horrible, it doesn’t change our lives, as the two Supreme Court rulings said the same thing as before. It’s just that this is final. “said Jain.
Earlier this year, Dream Sports closed a second round of $ 400 million in financing that valued the company at about $ 5,000 billion. In an interview with ET, Jain said: “Our focus now is on diversification. We have a good core business, a market that is a leader in its field. Now we want to build sports YouTube, Gmail and Google Maps. We want to build an entity like Alphabet. , not just Google Search. ”Alphabet Inc. is Google’s parent company.
The 13-year-old company has diversified its offering in recent years to cover the scope of Indian sports technology products and services. It offers payment solutions through DreamPay and has launched a DreamX accelerator. Dream Sports also operates DreamSetGo, a sports experience company.
“We are not a VC fund and we do not have a fund cycle. It is possible to buy a million dollars and a minimum investment of $ 100 million is possible. We are happy to help you invest and build, ”Jain said when asked how he would differentiate corporate VC from investor risk.
Unlike traditional VCs, Dream Capital’s CEO of Dream Sports will provide entrepreneurs with access to Dream Sports ’125 million users, marketing and marketing strategy.
Addressing concerns that startups may have with corporate investments, Bajaj said the company will sign confidentiality agreements and their data will be kept private.
“It depends entirely on what the creator wants. We are good at investing with other VCs. If after a turn, the entrepreneur comes and ‘you know what, I don’t want too much strategic money. Now I want to raise money from another LH or LH. That’s fine. Let’s do our best for the entrepreneur and the company, ”Jain said.
The investment committee is made up of the CEOs of Dream Sports and the founders of Jain and Bhavit Sheth. “This is very important because we look at investments from a very different perspective than profitability. [We don’t think] “Oh, this is something that will jump in the rating and then we can flip it,” Bajaj said.
“It’s a very important strategy for us, basically thinking about our users and where they spend their time, and how we can get a bigger share of their portfolios,” he added. “Now we’re trying to create a platform where we can offer a wide range of services, both in sports and in fitness.”
Jain said the two waves of the Covid-19 pandemic have been the roller coaster of the sports industry.
Interruptions and cancellations of sporting events have had an impact on the fantasy sports industry, which is based on live games.
“We’re 70-80% of where our projections were for business. But I can’t complain. Of course, we’ve been pretty bad at running the whole ecosystem. We’re profitable, but we haven’t announced our numbers,” Jain said.
In the wake of the technology’s initial IPOs, Jain said the company is “not opposed to being public,” but that there is no specific deadline. “We never had the idea to make it public through a SPAC (Special Purpose Purchasing Company) … We don’t have much time left …”
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