Bangalore-based MagicStick in talks with Sequoia, Kae Capital to raise US$5 million
MagicStick recently launched its PC stick — a fully operational desktop PC that can be plugged into any television or desktop socket
MagicStick, which recently launched its PC stick, is in talks with venture capital funds Sequoia and Kae Capital to raise US$5 million by February, Co-Founder Sai B Chintala told e27.
The Bangalore-based startup, which claims to be the fastest HDMI stick in the world, competes with the likes of Intel, Lenovo and Google, via Asus, that have all released their own PC sticks.
An HDMI or PC stick works as a fully operational desktop PC that can be plugged into any television or desktop socket. A screen, keyboard and mouse just need to be added. It can used in the same way as a normal personal computer.
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“We are already in talks with a few VCs to raise funds of around US$5 million and we plan to go in for Series A by March and probably raise US$20 million then,” he said.
“The US$5 million — We are planning to raise it from Indian VCs. We are already in talks with Sequoia Capital and Kae Capital,” he added. He said many global VC funds have shown interest in the Series A round.
Initially, the company took the crowdfunding route through Indiegogo to raise funds and managed to garner over US$540,000, a substantial increase from the US$50,000 it had targeted.
“We have already got US$540,000 from Indiegogo our goal was to raise only US$50,000 and now we are using these funds for the manufacturing of the device,” Chintala said.
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The future rounds of funding will be utilised to increase manufacturing and to ramp up its sales and marketing activities.
“It is a global device so we also want to open more offices overseas in countries like US and UK,” Sai said.
While, MagicStick is yet to be launched commercially, the company claims to have received over 3,000 pre-orders for the product, mostly from the US.
MagicStick is available in two variants priced at US$139 for the 2 GB RAM version and US$329 for the 8 GB variant.
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At present, the company has partnered with manufacturers in China, but Chintala says there is a possibility of manufacturing the MagicStick in India.
“We may tie up with Foxconn for manufacturing in India, since they already present here. But that we will see at a little later stage. We will look at possibilities,” he said.
Foxonn, the world’s largest contract manufacturer of electronics goods, has announced its plans to spend US$5 billion, to set up multiple manufacturing units in India.
“The Telangana government has invited us to set up manufacturing units there, they are open to offer us sops for that,” said Chintala.
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