CBA Capital Makes First Close Of Early Stage VC Startup Fund At $15.6 Mn

Bengaluru-based education-focused VC fund CBA Capital has raised $15.6 Mn (INR 100 Cr) towards the first close of its fund, Education Catalyst Fund or ECF.

The VC fund will focus on backing startups at Pre-Series A, Series A, B and C equity rounds. ECF’s mission is to support 15 entrepreneurs dedicated to providing solutions for imparting education and skills training to individuals and professionals from the low-income segment, as in households that earn less than $12 per day.

With the first close, it has also announced investments  in three tech startups: Simulanis, Kopykitab and Buddy4Study. The total commitment in these three companies is approximately $2.35 Mn (INR 15 Cr).

New Delhi-based Simulanis is engaged in transforming training programmes in corporates and institutions into interactive augmented reality/ virtual reality (AR/VR) modules. Kopykitab is a Bengaluru-based startup offering a digital textbook platform and Buddy4Study is a Noida-based startup that develops tech-based solutions to manage student scholarship systems.

CBA Capital was launched in 2013 and is backed by Michael & Susan Dell Foundation. ECF was established under the Alternate Investment Fund Category II scheme of the Securities and Exchange Board of India. It is also the first multi-investor fund to focus exclusively on affordable education, jobs & livelihoods opportunities in the country. The investors include Gray Matters Capital (GMC)and a few private investors in India.

“We are excited to launch a first of its kind, multi-LP venture capital fund seeking to support and participate in the single largest human potential opportunity on the planet: the Indian Education Industry” said Vishal Bharat, Managing Partner of ECF in a media statement.

He further added, “Only a fraction of all venture capital funding is going to the education sector but the long term impact an investment in this sector can make is exponential. We aren’t just talking about the financial returns from a 10-year fund; we’re talking about changing the trajectory of a society by impacting the entire learning ecosystem in India.”

Over the past three years, CBA Capital has also established a deep understanding of the space by working with young edtech companies through the “India Education Investment Fund” (IEIF), a proprietary fund of Michael & Susan Dell Foundation. IEIF focuses exclusively on early stage, high quality, affordable education and skilling solutions targeted at urban low-income families. It has Seed funded six young companies till date including Oliveboard, edtechChipperSage, GuruG, Report Bee, School Mitra and Select Jobs.

The year 2017 also witnessed the announcement of a number of VC funds in the early stage startup ecosystem of the country. This included $53 Mn second VC fund of Kae capital; $15.4 Mn fund of Equanimity & Sanctum; $100 Mn tech startup fund of Honeywell Ventures and more. The scenario of early stage funding in India is at an all time low currently.

As per Inc42 Data labs, there has been seen a 35% decline in Series A funding in 2017 in comparison to 2015. Also, Seed funding is at an all time low, registering 21% fall in the amount of funding in 2017 in comparison to 2016. The latest fundraise of VC fund CBA Capital will thus open doors of opportunities for early stage companies in India, providing them with the much-required early stage capital.