Artha Launches INR 450 Cr Micro VC Fund To Make Follow-On Bets

Mumbai-based Artha Group has launched INR 450 Cr winners-only micro VC fund, Artha Select Fund (ASF), to invest in its portfolio startups. 

ASF will invest in the top-performing startups from the group’s portfolio of over 100 startups, with a focus on Series B and Series C funding rounds.

The average investment size would be INR 20 Cr per investment in Series B and follow-on Series C rounds, Artha Group said in a statement. 

The fund intends to back 12-14 startups. While the first term sheet has already been signed, it will announce the first close shortly.

ASF raised its first INR 100 Cr from current limited partners (LPs) in less than three weeks. 

The Pune-based Kirloskar Family Office, the family office of former Reliance Capital CIS Madhusudan Kela, and British International Investment MD Abhinav Sinha are some of the investors who have backed the fund. In addition, Sinha will also join the investment committee of ASF.

“We see early-growth rounds as an amazing investment opportunity to back founders at a critical inflection point in their venture journey. .With ASF, we provide our founders with the added firepower to chase sound business metrics like revenues, positive unit economics, and profitability,” Anirudh A. Damani, managing partner of ASF, said.

Artha Group counts OYO, Purplle, LeveragEdu, Tala, IconBuild, Rapido, Coutloot, Chai Break, Karza Technologies, and Mobilewalla among its portfolio startups.

The announcement comes at a time when the Indian startup ecosystem is reeling under the impact of the funding winter. The funding crunch has forced startups to take various measures to cut down costs to increase their runway, including laying off employees. According to Inc42’s layoff tracker, Indian startups have laid off 12500+ employees in 2022 so far.

However, a lot of venture capital firms have launched new funds focused on India in the current year to invest in startups. On Monday (October 10), Mumbai-based Inga Ventures announced that it has partnered Singapore-based TIH Ltd to launch a $15.1 Mn fund to invest in Indian mid-sized companies, including startups. The overall target for the fund is $60.6 Mn.

Earlier this year, LetsVenture cofounder Shanti Mohan launched a micro venture capital (VC) fund Propell. Several VC firms such as Elev8 Venture Partners, Weave Capital, and All In Capital also launched India-focused funds recently.

The number of VC funds launched in the year 2022 till September 30 grew 2.2X to 71 compared to 33 in 2021, according to Inc42 data.