Rajesh Kamat, a former group COO with Indian broadcaster Viacom18, entered a different world when he became the first India CEO of a new private equity firm, CA Media, two years ago.

After working to the rhythms of the weekly TV ratings report, Kamat has been busy evaluating niche business models and multi-year investment horizons instead, buying stakes in Graphic India, a digital comic book publisher, and Only Much Louder, an alternative, non-Bollywood music promoter, while incubating a talent management start-up specializing in social media, called Fluence.

CA Media’s first deal however, returned Kamat to more familiar territory: a 49% stake in the Indian arm of production house Endemol – a unit Kamat helped set up in 2006.

Endemol India is already a sizable business, offering more immediate opportunities than CA Media’s other assets; the investment offers a lower level of potential return as a result.

Nonetheless, there are key similarities, and the deal encapsulates core tenets of CA Media’s investment philosophy, as well as its vision for the future.

“The epicenter of our entire ecosystem that we are creating remains content,” Kamat says.

“Our first step was in content, through Endemol.”

Early promise

In fact, to reduce risk, Kamat looks for visible revenue streams throughout his portfolio.

Graphic India, which creates its own mythological and superhero characters with an eye on online and mobile distribution, also inks deals with traditional broadcasters and publishers.

The initial priority for Only Much Louder meanwhile is scaling up existing revenue centers such as live concerts and TV production.

Fluence, which already manages the online personae of Bollywood stars Amitabh Bachchan, Salman Khan and Karisma Kapoor, is setting up partnerships in the retail space, as well as online.

“Assets that come to you, which are just great ideas on PowerPoint but will not translate, can be dangerous,” Kamat cautions.

The collaboration with Endemol also serves as a reminder that India’s media landscape is already being disrupted, as the government pushes out digital TV across millions of homes.

Broadcast business models are about to be reshaped, and Kamat sees a chance to try something new.

One area of interest is how Endemol can shoulder more risk – and if all goes well, enjoy greater rewards – in scripted entertainment, by producing more shows on spec.

Kamat’s own experience tells him it will be challenging, but worth a try.

“If you have a product which is truly unique, the broadcaster is willing to look at you with whatever terms that come to the table,” he suggests.

“The broadcaster typically accepts international formats. Why should that be different in the scripted space?”

Global strategy

The focus on content, set to rise in value in a broadband world, also reflects the strategy of CA Media’s parent company, The Chernin Group, set up by former News Corp president and COO Peter Chernin.

Like Kamat, Chernin is a renowned content impresario, and his group operates a TV and production arm, Chernin Entertainment, while making its own bets on the future of media.

These include investments in Flipboard, an online aggregator, Pandora, a personalized radio service, Fullscreen, a web TV specialist, and Tumblr, a hybrid blogging platform and social network.

So far, CA Media’s investments have tended to fall between $2-25 million, but that’s about to change.

The Chernin Group received a combined reported US$300 million infusion from two big investors last year, Providence Equity Partners and Qatar Holding, and CA Media’s preferred ticket size has now risen to $25-50 million, to accelerate growth.

Even bigger deals could be put together, if other backers are willing to co-invest.

The fund, headquartered in Hong Kong under Paul Aiello, former CEO of News Corp’s Star TV network as well as one-time Asia head of technology, media and telecoms investment for Morgan Stanley, is also prioritizing China and Indonesia.

In India, there’s no shortage of potential deals, or capital ready to invest, but management bandwidth is in short supply, Kamat contends.

His focus is where he can apply CA Media’s collective knowhow – in the digital as well as TV content and distribution fields, plus consumer retail and entertainment, another sector on the brink of reinvention.

It’s a fast-changing and unpredictable India, where business models remain hostage to infrastructure development.

CA Media is in it for the medium term, Kamat explains, with exits at least five to seven years down the line.

Within the investment committee, meanwhile, there is a constant to-and-fro on risk appetite. “These debates continue on every asset.”