Client Associates Marks First Close Of INR 300 Cr Fund; Targets Early, Growth-Stage Deals

Wealth management and investment banking firm Client Associates has announced the first close of its maiden Category II alternative investment fund (AIF) at INR 300 Cr (approximately $36 Mn). 

The Client Associates Alternate Fund (CAAF) is a SEBI-registered Category- II AIF which invests in consumer tech startups at the Pre-Series A to Series B stages. 

It will look to back 12-15 companies with cheque sizes in the range of INR 10 Cr – INR 50 Cr per deal. Further, CAAF will also explore later-stage opportunities (pre-IPO) which offer value creation opportunities for its limited partners (LPs).

Client Associates is targeting commitments of INR 500 Cr ($60 Mn) by exercising INR 200 Cr ($24 Mn) green shoe options and closing the fund by the end of FY25.

The firm claims that CAAF has garnered strong interest and participation from domestic family offices and ultra high net worth Individuals (UHNIs), primarily the existing customers from its wealth management business. 

Further, it said that it has relationships with over 1100 HNIs and UHNIs families in India and is managing assets under advisory (AUA) of $5.5 Bn.

“CAAF’s investment strategy is designed to capitalise on the immense potential of India’s startup ecosystem. We are excited about the opportunity to partner fundamentally strong businesses with proven operational excellence. We aim to not only deliver solid returns for our clients but also contribute to the growth and development of the overall ecosystem,” the fund’s executive director Shivam Diwan said in a statement. 

The wealth management firm’s maiden fund comes at a time when UHNI and HNI investments in the Indian startup ecosystem are soaring. By 2025, it is projected that UHNIs are likely to invest over $30 Bn in tech startups in India, led by large family offices and other wealthy individuals such as new-age entrepreneurs. 

Banking on the trend, fintech unicorn Incred Group’s alternative investment platform InCred Alternatives Investments also launched its maiden Category II AIF earlier this year. Similarly, earlier in February, asset management firm Rockstud Capital also marked the first close of its second AIF at INR 68 Cr ($8.2 Mn).

While early-stage investments have become a focus area for venture capital firms, there is plenty of interest in the growth funding stages especially as there is a wide expectation of economic recovery after FY25. 

A number of growth-stage firms are also lining up IPOs for the next year, which offers investors an exit opportunity through public listings.