Axilor Ventures Sets Up $100 Mn Fund II; To Back 125 Seed Stage Startups

Seed stage VC firm Axilor Ventures has announced the launch of its second fund Axilor Technology Fund – II with a total corpus of INR 770 Cr ($100 Mn) – almost 4X its Fund I of INR 200 Cr.

The VC firm will continue to focus on emerging opportunities in enterprise SaaS, B2B commerce, agritech, consumer tech and healthtech, with a renewed focus on the fintech sector.

Axilor will be writing a median cheque of $750K for 100-125 companies with 10-12 cheques every year. It has kept an option for another $250K in bridge rounds of certain companies, keeping the overall cheque size sub-$1 Mn.

According to Axilor Venture’s cofounder and CEO Ganapathy Venugopal (VG), the new fund will have a longer tenure of 15 years, as it will allow the company to stay with its seed portfolio companies longer. The new fund will also set aside 30% of the new corpus for follow-on investing in 10-12 startups from its Fund I portfolio’s growth stage round.

“Fund II will look out for founders who have respect for capital, with an operational mind and execution mindset. As for the companies, Axilor looks to back capital-efficient startups, who can scale with <$1 Mn by building for existing markets,” VG told Inc42.

Fund I was launched in 2018 and has invested in 54 startups, of which 21 startups have already raised their Series A and beyond. This makes Axilor one of the largest first funds to mint Series A+ companies from its portfolio. 

Axilor’s Fund I portfolio includes the likes of Detect, Enkash, Headfone, Loco, Urban Piper, Vyapar and Wiz, among others.

Axilor Ventures competes with the likes of Seqouia’s Surge and Leo Capital, but it goes beyond being just a fund. It helps founders with a community Enterprise Network (AXENT), where founders help founders with technical, business, tactical, strategic, fundraise and talent, among other issues.

Seed Stage Funding In India – H1 2022 Showcases Spring In Winter

Funding winter has been a part of every conversation within the startup ecosystem for the past six months. Needless to say that with the cash crunch, recession and 11K+ layoffs, the past few months have been pretty rough for the Indian startup ecosystem. 

Yet, while late and growth stage funding has declined considerably, seed stage funding seems to have only risen. In the first half of 2022, seed stage startups raised around $1.3 Bn in funding – a 70% increase from the previous half-year.

“Between 2017 and 2022, a lot of infrastructure has been put in place in terms of the digital railroads,” VG told Inc42. “This means that from 2022 to 2027, we will certainly see a similar boom in B2B commerce as with B2C and fintech. I think the opportunities are only more exciting than what it was before.”

The $100 Mn fund is only a reflection of Axilor’s bullish stance on the startup ecosystem, with a vision to improve the success rate for early-stage startups. 

“We will continue to focus on early stage and make sure that capital is available to early stage companies as we continue to be in the top five Series A pipeline creators in the country.”

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