Micro VC funds are becoming more and more common in the Indian startup ecosystem. Now three graduates from the Indian School Of Business (ISB) are joining the brigade with Atrium Angels. Abhishek Nag, director of business development at Netflix; Umang Kumar, cofounder and president at CarDekho; and Varun Laul, head of digital and technology investments at Investcorp India have come together to launch the early-stage sector-agnostic micro VC fund.
The fund, with an undisclosed corpus, will provide pre-seed and seed-stage capital to startups where at least one cofounder is an Indian School of Business alumnus. ISB has campuses in Hyderabad and Mohali in India. OfBusiness, LivSpace, MindTickle, MyGate, boAt, 91mobiles, Moglix, Lendingkart, mGinger, Nearbuy, MoneyTap, LaurusLabs, Postman, Navia, InMobi, Wakefit, Leverage Edu, and UpGrad are among the startups that have founders from ISB.
“We estimate that 10% of all ISB alumni are starting up their own ventures. We aim to be the first port of call for all ISB founders, and hope to leverage the entire ISB network for these founders,” Nag said.
Besides capital, startups will gain access to the know-how and individual networks of the founders, investors and startup ecosystem stakeholders that are limited partners in the fund, as well as from the broader ISB Alumni Community. Atrium Angels is targeting 12-15 pre-seed investments over 18 months with investments already made in analytics startup Goodmeetings, gaming platform FanPlay, and investing platform StockGro.
The fund is backed by 29 ISB alumni including Livspace cofounder Ramakant Sharma, OYO India CEO Rohit Kapoor and boAt cofounder Aman Gupta. The fund is also syndicated with a network of investors including Chiratae Ventures, Roots Ventures and Velo Partner for co-investments. Other LPs include angel investor Ankur Agarwal, 91mobiles cofounder Bharanidharan Viswanathan, Junglee Game’ Suhas Khullar, Flipkart’s Rakesh Krishnan, Press9 cofounder Vignesh Ganesan, Force Ventures founding managing partner Karthik Bhat and JavaCapital founding partner Bhargavi V.
“Startups can benefit the most from networks like alumni networks at the earliest stages when they need help with hiring, sales, mentorship, and business development. Hence, we are largely going to be a pre-seed fund. We will be sector agnostic and write flexible cheques between INR 25 L and INR 2 Cr per investment,” Atrium Angels’ Nag told Inc42.
Typically, micro VC funds have a corpus of less than $30 Mn and they invest in 10-15 pre-seed and seed stages of startups, rarely going to post-seed. According to a recent report by IVCA, AWS and Praxis Global Alliance, the number of micro VC funds in India has increased to 88 in 2020 from 29 in 2014.
Recently, the government also unveiled the Startup India Seed Fund of INR 945 Crores ($127.3 Mn) to financially support about 3600 early-stage startups and 300 incubators. The fund would provide financial assistance for proofs of concept, prototype development, product trials, market entry and commercialisation of products or ideas.
The Inc42+ Annual Indian Tech Startup Funding Report 2020 shows that early-stage startups have raised $403 Mn at the seed stage in 2020 — nearly double the $255 Mn in 2019.