John Paul, founder of period tracker app Maya , had to wait for four long years before starting operations in India this year. Started in 2012 in the US, the tracker has had over 6.5 million downloads across 190 countries; was available in 12 languages; and has Brazil, Italy, Mexico, Russia and South Korea as its top five markets . Still it remained bootstrapped.Reason: It was operating out of Bengaluru and catering to global markets . Global investors were keener on investing in a venture with offices across the globe.Cut to 2016. Paul has raised two rounds of funding from Indian investors since its debut in the country in March this year. While it raised Rs 5 crore from Bengaluru-based Prime Venture Partners in March, it recently bagged an undisclosed amount from Rajan Anandan of Google India.So what changed? Simple, Maya rolled out operations in India, and added two more languages, Hindi and Tamil. What also nudged Paul to start local operations was a perceptible change in mindset. “Back in 2012, a product like Maya had cultural barriers in India,” he recalls, adding that India is now the main focus. “If India is a focus market , it definitely makes sense to raise money from Indian investors,” he says.Paul is not an aberration. Over the last few months, a bunch of global startups, including those that don’t have operations here, had raised money from Indian investors.Investors are not surprised by the trend. Sid Talwar , cofounder of Lightbox Ventures, a venture capital firm focused on early-stage consumer tech businesses, contends there are three big reasons for raising money from Indian investors.First, it makes a lot of sense for those companies that see a larger than expected user base coming from India. For example, one reason Truecaller might have come to India in 2015, could have been that more than half of its users at the time were Indian.Second, several overseas startups may be planning to venture or may already have back-end operations in India. “This happens quite a lot and who better to understand the cost arbitrage than an investor in India?” asks Talwar.The third trigger, he lets on, is when founders have a better network in India than in other parts of the world; it gives them quick access to decision makers in the institutional investment and angel community.Take, for instance, Deap Ubhi. The cofounder of TableHero, an automated customer acquisition platform for restaurants, has been operational in the US since January, and raised $1 million in an angel round this year from Indian investors such as Powai Lake Ventures, Kunal Shah and Sandeep Tandon — this despite TableHero not having India operations! Why Indian investors?“It’s where folks know me, and where ventures like Burrp and FreeCharge, to name just two, are familiar with my work.” That made raising a quick party round a lot easier than having to establish credibility in the Bay Area, and raising money from there, he adds.“I spent nearly 10 years of my professional life in India, which is ironic given that I was born and raised in the Bay Area,” he says.Israeli entrepreneur Alon Zion, for his part, is convinced that India is a land of increasing opportunity. It’s the biggest cash-intensive market in the world , where about 90% of transactions occur in cash (although that may be fast changing, with the government determined to transform the country into a cashless society). For Zion’s startup Vala , which offers money transfer via a network of cash agents who serve as human ATMs, the Indian market holds out immense hope.Indian culture, contends Zion, is deep-rooted in family values where financial responsibility is shouldered by members who live away from home. “This makes India one of the biggest markets when it comes to money transfers and overseas remittance.”Zion entered India just nine months after starting operations in Israel last December. In quick time, he beefed up the force of cash agents in the country to 1.5 lakh, and plans to close a seed round with Indian investors (in March, he had raised angel funding, with one of the angels being Indian).You would wonder why Zion had to zero in on India for funding, considering that Israeli startups have traditionally been hot property, globally renowned for their tech innovations.Zion explains that while an Indian investor will play a part in building customer trust and can be of great help in collaborating with local partners, he is also in a position to provide strategic insights in the remittance space of the dynamic domestic market.While some American and Israeli investors did show interest, he claims, Vala would prefer an Indian investor at the forefront, given the target market of the startup.To be sure, in the context of the massive demonetisation exercise taking place , an Indian investor may indeed be priceless in times when cashless has become a buzzword.In the short term, however, the shrinking of notes in the system will do little good to Vala’s cash-intensive model. “In the longer term, Vala’s app endorses transparency and accountability of cash ownership,” says Zion, adding that the journey ahead could be a bit like his tryst with Indian food — in the beginning, the spice can take you by surprise but, once you get the hang of it, you keep coming back for more.Indian venture capitalists are not surprised to see overseas startups raising money from India. There are two things happening simultaneously, they contend: Indian startups are going global right off the bat, and international startups are finding a large audience in India.For the going-global brigade, the obvious lure is that the markets are bigger, more accessible (than India) and may offer a cost advantage (over India); for the latter lot, the India sojourn may be more serendipitous, as in the case of mobile apps , explains Amit Somani , managing partner of Prime Ventures, an early-stage investment fund based out of Bengaluru.“Thanks to smartphones and global distribution through app stores, India is a big audience for global companies,” he adds. A lot of the user growth in the world, even for global offerings like Google, Facebook and WhatsApp, is coming from India. “If the market ends up being dominated by Indian consumers, having an Indian investor would help build the company,” he says.But it’s not only those who have trained their sights on the India market that are raising money locally; even those without a presence in the country — at least, not yet — are reaching out to Indian investors. Take, for instance, John Dillon, the 22-year-old cofounder of Boston-based pet venture VetX.Founded in March 2015 in the US, the on-demand veterinarian startup raised $2,00,000 from Frontline Strategy and CCube Angels, both USbased funds. It has also got a bunch of Indian investors.“The second round was raised by investors in India. Unfortunately we can’t name them,” says Dillion, who plans to enter India once he has expanded in Europe VetX allows veterinary clinics to engage with patients off hours by providing them roundthe-clock access to veterinarians as well as being a platform where pet owners can browse and ask veterinarians questions they have about their pets on demand.“So it’s both a B2B and B2C platform,” says Dillion, adding that while the B2C side is completely free to use for the pet owner, the B2B side monetises by charging clinics $500 per month or $5,000 every year.“The trigger for us was a large uninvested capital pool among investors, and future India plans.” The prospect of a tantalising future is something which brought Brian Hart from San Francisco to India. “India is a prime target market for us with mobile virtual reality,” says Hart, cofounder of Xanadu Heights, a virtual reality gaming startup focused on creating immersive content for desktop and mobile. So it made immense sense, he adds, to approach Indian investors who knew the market and could guide on strategy.Founded in September 2016 in San Francisco and operational in the US only, Xanadu raised its first round of funding in October.While the investment was led by Dheeraj Jain of Redcliffe Capital, which has offices in Gurgaon and London, Xanadu also has investors in the US. “As a gaming franchise, we absolutely love working with smart and fun people , globally,” he says.Hart maintains that raising venture capital is as much about forming strategic partnerships as it is about putting money in the bank. When the American entrepreneur reached out to Redcliffe, and shared his plans to launch products for dedicated gamers first and then casual gamers, they clicked with Jain, who was scouting for investments in virtual reality segment.“We were able to find a connect with our longterm vision right away,” says Hart, adding that he is open to investment globally, as long as there is a good mutual fit. For now, however, Hart reckons that India is not yet ready for his offerings. India is a price-sensitive market, and will find current generation desktop virtual reality adoption too expensive.With Microsoft’s announcement that it will launch $299 headsets in 2017 spring, and a corresponding drop in virtual reality-ready PC and laptop prices, India could well be an interesting market for desktop virtual reality in 2018, he adds.“We expect India to be among the top three target markets for the mobile version of Xanadu Heights,” he says. While in the short run, the focus will be on making a fun game in virtual reality, over the next two years the target will be to localise the game in terms of language, device, and platform for different international audiences, including India.It’s not only overseas entrepreneurs who benefit from taking a far-sighted approach, Indian investors too gain in return by taking calculated risks on foreign ventures. “Portfolio diversification is always a wise move,” says K Ganesh , chairman of Portea Medical.By investing in other parts of the world, investors get to diversify the geography risk . With the 2015 run-up in Indian market valuations, the opportunity outside looked attractive. Indian investors definitely should look at opportunities globally. They can get attractive valuations and good upsides, he adds.But do Indian investors really bring anything to the table for the ones who are not operational here? Ganesh feels desi guys have a lot to offer. They can add value by offering the India advantage to the companies they invest in such as using India as a supply base for manpower, skills and manufacturing.“The lower costs of producing goods and services in India will be a positive,” he says. Besides, India can be a good testing ground before a global launch. For Aditya Mishra , entrepreneur and investor in two global ventures, investing in overseas startups makes sense only for one reason: opportunity.“It’s very opportunistic and based on the comfort with product as well as market fit and team,” says Mishra, who did his bachelor’s from Georgia Institute of Technology in Atlanta , and an entrepreneurship certification from the Stanford Graduate School of Business Mishra cofounded Singapore-based data analytics platform Zenprivex, which has offices in Bengaluru and San Francisco, and had evaluated over 30 investment opportunities in India but didn’t invest in any. Reason: he is more comfortable with the US market due to visibility in follow-on funding and exit options along with higher multiples.With the American and Chinese investors establishing their clout globally, is it the right time for Indian investors to flex their financial muscles? Mishra contends that while there’s a next wave of entrepreneurs and investors in the Indian ecosystem who understand the nuances of building a tech company, corporate venture capitalists are likely to make strategic bets overseas. “The next phase of successful entrepreneurs would look for strategic investments overseas,” he says.Take, for instance, Ajay Yadav, founder of New York-based Roomi, a shared housing marketplace for renters. Started in April 2013 in the US, Roomi raised $2 million in seed funding in June last year from a clutch of American investors, including Cyan Banister and Great Oaks Venture Capital.Operational in three countries, including Canada, Roomi entered India in September this year and roped in Arihant Patni as one of the Indian investors. “Bringing on an Indian investor was about getting to India,” he says, explaining how: the Indian investor lives in Mumbai , and is able to share legal advice and insights on the unique needs of the Indian market that the startup couldn’t get anywhere else.The biggest value, he contends, is in cracking the local problem. Finding affordable housing and like-minded roommates is a universal problem, but in India it needs to be solved in a different way.For instance, New Delhi isn’t a broker-free marketplace, so the kind of questions that Yadav had to confront were like: “What kind of marketplace should we become? Should we partner with landlords or brokers? Or should we be peer to peer?” Yadav has built a dedicated team in India, with special emphasis on operations, marketing and research.Sid Talwar of Lightbox Ventures maintains that for institutional and angel investors looking for best deals, at times the opportunity could be outside the country. “For angels, it’s their own money. So there isn’t a mandate at all. They are free to invest anywhere,” he says.Ask him if Indian funds can compete with the global ones, and Talwar sounds optimistic. “Indian funds already compete with global funds in India,” he says, adding many local funds have done deals abroad and it’s only a matter of time that more such deals happen. Desi by then may well become the new videshi.