Former Infosys directors T.V. Mohandas Pai and V. Balakrishnan (Bala) have funded an enterprise software product firm here in the area of governance, risk management and compliance management.
“Pai and Bala have invested in raising USD 250,000 (Rs.15.6 million) as seed capital to fund the startup, which will develop niche software products for regulatory and governance compliances,” Clonect Solutions Ltd co-founders Balaji Rao and Shailesh Agrawal told reporters here Tuesday.
The two co-founders, also former Infosys employees, however, did not disclose investment made by Pai and Bala for the paid-up capital, or their own and that of former Wipro director B.C. Prabhakar and a few angel investors.
“The seed capital will sustain us over the next 18 months in ramping up our operations, including sales and marketing force to hard-sell our products,” Rao said on the occasion.
The city-based firm has set a revenue target of USD 100 million by 2020.
Claiming to the first such `made in India` product in the niche area, Agrawal said the trademark registered `ricago` is a compliance ERP platform to help medium and large enterprises across verticals address the risk of non-compliance.
“Our technology platform is a suite of products integrated for compliance ERP (enterprise resource planning) through management system and can handle end-to-end requirements in the post-2008 financial meltdown era,” Agarwal added.
The startup has 10 customers from diverse verticals across the country, and they could install and customise the product in their enterprise system through cloud or web-based platform.
Mumbai-based micro-finance firm Suryoday is the first non-banking financial company (NBFC) among the 10 customers to use ricago for total compliance.
“The global compliance product segment market is estimated to be USD 10 billion by 2018, growing at 14 percent annually, thanks to increasing regulatory and mandatory obligations the world over for large listed or privately held firms in diverse verticals, including information technology, manufacturing and BFSI (banking, financial services and insurance),” Balakrishnan said.
With regulators like Sebi (securities exchange board of India), Reserve Bank of India and stock exchanges insisting on highest corporate governance, transparency and full compliance with statutory guidelines or terms, enterprises will have to use products like ricago for compliance.
“Compliance is a major challenge to all corporates and very high on their board priorities. For management too, compliance is high on the list of things to do. Its complexity needs an end-to-end solution like ricago,” Pai said in a statement on the occasion.
The company also unveiled an insider trading management system, an enterprise class web application to automate and address the challenge of complying with regulatory requirements specific to insider trading.
“With Sebi notifying the new insider trading norms from May, many firms would need an IT-enabled system to keep pace with the regulatory requirements,” Rao added.