Mumbai Based 35North Ventures Launches $20.8 Mn Early Stage Fund

Mumbai-headquartered 35North Ventures has finally received a nod from SEBI to launch a $20.8 Mn (INR 130 Cr) early stage fund. The early stage fund is designed to help early stage startups grow and expand.

The early stage fund is designed to help early stage startups grow and expand.

As per a recent report, the fund will look to back 8-10 early-stage startups in agritech, fintech, consumer tech, and healthtech segment.

Commenting on the development, Ashwani Singh, Managing Partner at 35North Ventures said, “We are looking at (investing at the) Pre-Series A and Series A stages. We will look for companies that are 1.5-2 years old with at least two-quarters of revenue history.”

He further added that the firm was targeting an internal rate of return (IRR) of 25%.

35North Ventures: Plans Ahead

Dubbed as the 35North India Growth Fund, the Category-1 Alternative Investment Fund  (AIF) will include ticket sizes ranging between $500K to $3 Mn (INR 3 Cr to INR 20 Cr). Names of the investors remain undisclosed. However, it is reported that a few prominent family offices in India as well as global high net-worth individuals (HNIs) will be backing the fund.

As per reports, the early stage fund will make first $6.4 Mn – $8 Mn (INR 40 Cr – INR 50 Cr) investment within the next 2 to 3 months. The remaining amount will likely be closed in six months. Singh added, “We have been screening companies over the last 5-6 months, so we have a pipeline of potentially large bets. By early next year, we should be able to deploy 60%-70% of the fund.”

The firm is also in the process of raising another $200 Mn-$250 Mn fund, which will commence after the first fund closes. Singh states, “The idea with the first fund is to deploy most of it in the next six months and simultaneously start working on raising the second fund. Hence, when we are screening opportunities, we are looking for a fit in both funds.”

Specialising in Pre-Series A and Series A VC funds, the asset management firm currently operates in Mumbai, Bengaluru, and NCR through an affiliate. It serves as a business catalyst for growth-stage companies in two primary sectors- technology and consumer market.

In January 2017, the company started a similar growth fund of an undisclosed amount for tech-savvy consumer startups. It will be used to explore investment opportunities in companies with commercial validation and those that have generated revenues for at least two quarters.

Other Early Stage Fund Launched In Q2 2017

In the past few months, the startup ecosystem has witnessed the launch of several such growth and early stage funds. They were aimed at facilitating the development and expansion of new companies and startups.

Earlier this month, Assam-based Numaligarh Refinery Limited (NRL) launched a $1.5 Mn (INR 10 Cr) fund to promote startups in Northeast India. The states falling under its purview include Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Tripura, and Sikkim.

Kolkata-based Srei Infrastructure Finance Ltd recently joined hands with Russian Government-owned Vnesheconombank to create a $200 Mn fund to support innovation in the field of information technology (IT). The partnership will help foster cooperation between the two countries. PM Narendra Modi-led Indian government also teamed up with the Israeli government to create a five-year technology fund known as the Israel-India Innovation Initiative Fund (I4F).

Recently, former Infosys CEO Nandan Nilekani and Helion Ventures founder Sanjeev Aggarwal joined forces to create a $100 Mn VC fund called the Fundamentum Partnership. The fund will be used to invest up to $25 Mn in Series B and Series C tech funding rounds. The Tamil Nadu government has also initiated a $77 Mn fund in a bid to build the country’s next top startup hub.

Under the PM Narendra Modi-led Startup India Action Plan, a ‘fund of funds’ of $1.4 Bn (INR 10,000 Cr) has been established to support innovation-driven startups. The initiative is being managed by SIDBI, which has already poured over $96.5 Mn (INR 623.50 Cr) into 17 Alternative Investment Funds, as of March 2017. Among the funds that are supported by SIDBI under this plan are Unicorn India Ventures Fund I, Idea Spring Capital – Future Now, Pi Ventures Fund I, Ventureast Proactive Fund II, Omnivore Partners India Fund 2, Parampara Early Stage Opportunities Fund I, Ivycap Ventures Trust Fund II, IAN Fund I, Aavishkar Bharat Fund and others.

35North Ventures’ newly-raised early stage fund can be perceived as a step forward in the ongoing startup revolution in India.

(The development was reported by ET)

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