SUMMARY
Chanakya Fund Trust’s maiden fund will also have a greenshoe option of INR 100 Cr
About 51% of the corpus would be reserved for investments in manufacturing, tech and consumer product startups
The fund will invest in companies that have the potential to get listed on SME exchanges with small size IPOs
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Chanakya Fund Trust on Tuesday (April 25) announced the launch of its maiden INR 100 Cr ($12.5 Mn) sector-agnostic fund to invest in startups and small and medium enterprises (SMEs).
The SEBI-registered Category-II alternative investment fund, Chanakya Opportunities Fund I, will also have a greenshoe option of INR 100 Cr.
The trust said that the fund would invest in profitable SME companies with high-potential opportunities in unorganised sectors. About 51% of the corpus would be reserved for investments in manufacturing, tech and consumer product startups.
The fund will invest in about INR 2 Cr-INR 10 Cr each in about 25 companies, a statement said.
“The fund will provide exit opportunities through primary markets as it intends to invest in companies that have the potential to get listed on SME exchanges with small ticket size IPO,” it added.
The Trust aims to raise capital from resident and non-resident Indians, high-net-worth individuals, banks, accredited investors, corporates, and trusts.
“Chanakya Opportunities Fund I is our first offering. We are planning to raise INR 100 Cr in the first year. This is a close-ended fund, and we will be accepting subscriptions for the tenure of five years from the first close with a maximum of two extensions of one year each,” said Kresha Gupta, founder and fund manager of Chanakya Fund Trust.
The announcement of the new fund comes at a time when investors are sitting on their dry powder and shying away from investing in Indian startups. Macroeconomic headwinds, sharp decline in valuation of listed companies, and fears of an upcoming global recession have made investors cautious.
A series of corporate governance issues at startups like Zilingo, GoMechanic and BharatPe have also led to investors tightening their purse strings.
However, investors remain bullish on the Indian startup ecosystem in the long run and continue to raise fresh funds.
Earlier today, Real Time Angel Fund announced the second close of its maiden fund at INR 125 Cr and increase in total corpus of the fund to INR 510 Cr. Earlier this month, venture capital (VC) firm Speciale Invest launched an INR 200 Cr growth fund to invest in its portfolio startups.
As per Inc42, India saw the launch of 126 new funds in 2022, which together raised a corpus of $18 Bn.
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