Why is Citibank putting money into dotcoms?

"Not too many people know that we are in the venture capital business," she responds. "That is a completely separate line of business for Citibank. It is a pure equity investing business. Yes, if we can leverage the bank's services through these sites, become a payment gateway, that's fine."

Products, services and technologies are all things, Citibank is looking at seriously in its venture capital activities. The bank has been in the venture capital business since end-1995. "We have been there for fairly long, and we've been through a huge learning process," says Ms. Ahuja.

Citibank has invested in about 30 technology companies in India already, including Polaris, DCM-ASIC and Silicon Automation, all chip design companies, and Kshema Technologies. "The bulk of our investments are in information technology, not dot coms. We have a couple of investments with infrastructure providers." In the last segment, Citibank invested in Dishnet DSL, the only DSL Internet service provider in India. Its investment of $ 5 million, in February 2000, translates to a 1.4 per cent stake in the company.

And the philosophy for Citibank's dot com investments: "Invest in sites that have the potential to become global or world class. Or, look at stuff where you actually use the power of the Internet. We look for sites that change the way you deliver business," says Ms. Ahuja.

Citibank's dotcom investments

Ms. Ahuja rationalises Citibank's investments in dot coms based on this line of thinking. So for iCleo.com, a site for the "over-15 year-old woman", she says, "At the time we invested in this vertical portal for women, there was no other women's portal. It was the first women's portal to be launched." Citibank India invested $ 0.14 million for a 33 per cent stake in iCleo.com in December 1999.