3one4 Capital Closes Fund IV At $200 Mn

SUMMARY

Fund IV is 3one4 Capital’s sixth fund overall, and the VC firm has already committed to five investments from the fund

3one4 Capital will invest in early-stage startups ranging from pre-seed to Series A with cheques between $0.5 Mn to $5 Mn

The VC firm will focus on consumer internet, SaaS and fintech while increasing investments in areas such as healthtech and climate tech

Bengaluru-based venture capital (VC) startup 3one4 Capital has closed its fourth early stage investment fund, the Fund IV, at $200 Mn.

3one4 Capital will invest in early-stage startups with larger cheque sizes, ranging from pre-seed to Series A, with cheques between $0.5 Mn to $5 Mn. The median cheque size for these investments will be in the $1.5-$3 Mn range. The VC firm said that it would also look for potential post-seed and Pre-Series A funding rounds.

The VC firm will focus on sectors such as consumer internet, SaaS and fintech while increasing investments in newer areas such as healthtech, climate tech and more.

The VC firm said in a statement that the fund saw its first close in March 2023 and it has already invested in or approved five deals. The final close is expected by the end of Q1FY24.

It further said that while the fund was oversubscribed within 2.5 months of launch to $250 Mn, it did not expand the fund to match the oversubscription, closing it at the target amount.

Fund IV is the firm’s fourth early stage fund launched. 3one4 Capital said that 90% of the investors in Fund IV were institutional investors, including three ‘systemically important’ banks, five listed Indian banks, eight mutual fund operators, US university endowments, global sovereign funds, global corporations & insurance companies, India’s corporations and a selection of family offices.

The fourth early stage fund is 3one4 Capital’s sixth VC fund overall and will take its total committed capital to $510 Mn and assets under management (AUM) to $750 Mn.

Siddarth Pai, partner, CFO and ESG officer, 3one4 Capital, said, “At 3one4 Capital, we act proactively, support early standard-setting, and invest in durable technological assets that will solve the needs of the future. With its prompt adoption of global consensus frameworks like SDGs and ESG, India can lead the way in establishing a new paradigm of technological development in line with these forward-looking principles.”

3one4 has recently promoted Nruthya Madappa to partner at the VC firm. The VC firm has backed over 60 startups including unicorns Licious and Open, soonicorns Jupiter, Yulu and Kuku FM, and other big names including Koo, Pazcare, Growfin, ePlane.ai, BetterPlace, Breathe Well-Being and others.

The fund close at 3one4 Capital comes as investors in India have announced, launched or closed funds worth nearly $3 Bn since the start of 2023, per data compiled by Inc42.

Some of the recent announcements include last week’s Multiples PE’s $640 Mn fund close and Chiratae Ventures closing its Growth Fund I at INR 1,001 Cr (around $123 Mn), along with Capria Ventures’ first close of its $100 Mn fund late last month.

The fund close also comes at a time when the Indian startup ecosystem has been reeling under funding freefall. According to Inc42 data, Indian startups could only manage to raise $888 Mn in funding in April 2023, down 66% compared to last April’s $2.6 Bn.