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When Suresh Sambandam launched OrangeScape two decades ago from Chennai, workflow automation platform was almost non-existent in Tamil Nadu. Global investors preferred Bengaluru or Silicon Valley and the idea that a software company from the state could sell worldwide was greeted with scepticism.
OrangeScape later became Kissflow, a workflow automation platform that today counts more than 10,000 customers in 160 countries, including 50 Fortune 500 companies.
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Mudhal VC
That experience shaped Sambandam’s view of venture capital. Founders in Tamil Nadu, he says, need money earlier and with fewer conditions attached. “Nobody bets on companies at the very idea stage,” he said. “They just have a PowerPoint presentation, maybe the seed is there, but no one funds it. We want to be the first capital for a company.”
That is the idea behind Mudhal VC, the venture capital firm Sambandam set up last year with his son, Aravind.
Based in Chennai, the firm is deliberately provincial in its mandate: it invests only in startups from Tamil Nadu. The word “Mudhal” in Tamil means both “capital” and “first,” and Sambandam says both meanings apply. “We want to be the first capital for a company,” he said.
Rs 125 crore investment
The firm plans to invest about Rs 125 crore over the next three to four years. The first tranche, a Rs 25 crore family-office pool, is already active with cheque sizes ranging from Rs 10 lakh to Rs 1 crore. The second, a Rs 100 crore institutional fund, will be raised from limited partners and used for follow-on capital. “We are planning to invest close to Rs 125 crore in two phases,” Sambandam said.
What makes Mudhal unusual is its willingness to back entrepreneurs before their companies are even formed. Through its “Idea Pattarai” workshops in Chennai, Madurai, Tiruchi and Coimbatore, the fund meets founders, tests concepts and guides them through prototypes and customer pilots.
Only after three or four months of handholding does it decide on an investment. “We sometimes wire money before paperwork,” Sambandam said. “That’s the level of trust we build.”
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Father-son dynamic
For Aravind, who joined the venture after experimenting with his own startups in his early twenties, Mudhal represents a generational reset.
“Many traditional VCs wouldn’t indulge — no pedigree, no traction,” he said. “We want to change that. Our goal is to build the Y Combinator of Tamil Nadu.” The father-son dynamic, he added, is less corporate than it sounds. “At dinner, all we talk about is startups. Sometimes the disagreements are intense, but better ideas often emerge from the clash.”
So far, Mudal has invested in about 18 companies spanning electric vehicles, biotech, consumer products and software. One of its most visible bets is Bad Boy, an electric super-trike that claims a top speed of 200 km/h, a 400 km range and a 45-degree tilting mechanism.
Other portfolio names include Amura, Bversity, BookingBee, MeenSatti, Mushroom MaMa, PickMyAd, Social Gallery and Trashbotics. Sambandam said nearly half of Mudhal’s startups are already showing traction, compared to the venture industry’s rule of thumb that only one or two in ten survive.
Focus on Tamil Nadu
The contrarian focus on Tamil Nadu is not without risk. Bengaluru attracts more than half of India’s venture funding and even Hyderabad and Gurugram host denser startup clusters. Yet Sambandam argues that Tamil Nadu, with its industrial base, educated workforce and diaspora networks, can be the next hub.
“If you look at the trillion-dollar vision of Tamil Nadu, startups are going to play a big role,” he said. “All roads lead to Rome. For me, Rome is Tamil Nadu’s trillion-dollar vision.”
Despite his SaaS pedigree, Sambandam says Mudhal will remain sector-agnostic. But both he and Aravind believe the next wave will be in artificial intelligence. “There’s room for 10,000 AI companies in the next three to four years,” Sambandam said. “Tamil Nadu cannot miss this.”
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Capital meets founder ambition
The longer-term goal, Aravind says, is not just to write cheques but to produce scale-ready companies. “We want to take 50 companies across product–market fit and into the hands of larger VCs,” he said. “That means 50 new brands for India, and ultimately 200 global brands out of Tamil Nadu.”
For Sambandam, Mudhal completes a loop that began with building Kissflow and extended through his work in founder communities such as NASSCOM’s EmergeOut, iSPIRT, SaaSx and SaaSBOOMi. Those platforms helped Chennai’s SaaS sector emerge on the global map. Mudhal, he says, provides the missing piece — the capital to match founder ambition.
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