Early-stage venture capital firm DSG Consumer Partners (DSGCP) has announced a raise of additional $10 Mn (INR 63 Cr) in its second VC fund, DSGCP II, which backs consumer startups in India and Southeast Asia. This marks the fund’s final close at $50 Mn (INR 319 Cr).
As per reports, around two-third of the second fund came from institutional investors, family offices, and fund of funds. The remaining amount was contributed by existing investors. Details of these investors, however, have not been disclosed.
Commenting on the infusion of fresh funds, which has increased the company’s overall assets under management from $25 Mn to over $95 Mn, DSG Consumer Partners’ Deepak Shahdadpuri said, “We had a target of $40 Mn for the second fund and a hard cap of $50 Mn. We closed at the $50 million hard cap despite investor demand and had the difficult task of saying no to some investors.”
DSG Consumer Partners: From $25 Mn To $95 Mn In AUM
Headquartered in Singapore, DSG Consumer Partners is a Seed and Series A stage VC firm that primarily invests in unlisted companies in exchange for minority equity positions. DSGCP has the flexibility to provide capital for growth and to provide liquidity to founders and shareholders via secondary transactions. The founders have built a track record of investing for the long-term with an investment horizon of six to ten years.
The typical ticket size of investment ranges anywhere between $100K and $1 Mn. Over the lifecycle of an investment, DSG Consumer Partners can infuse around $1-5 Mn in the investee company.
Its first VC fund DSGCP I was set up in December 2012 to primarily back consumer startups in India and Southeast Asia. The fund has so far poured $24 Mn in nearly 21 consumer startups. In April 2016, the second fund, DSGCP II, made its first close at $35 Mn.
According to Shahdadpuri, the VC fund is backed by Belgium-based investment holding company Verlinvest, Sameer Sain (co-founder of Everstone Capital Advisors), Alok Oberoi (co-founder of asset management firm ACPI Investments) and Saama Capital founders Ash Lilani & Suresh Shanmugham.
Since its first close, DSGCP II has committed more than $13 Mn in around 11 consumer startups. Its portfolio of investments includes consumer startups like Mswipe, budget hotel booking platform OYO, tea chain Chai Point, Greek yogurt maker Epigamia and Veeba Foods.
In December last year, DSG Consumer Partners participated in a $4 Mn Series A funding round for Delhi-based credit and fintech startup IndiaLends. The round also saw participation from American Express Ventures, Chinese investment firm Cyber Carrier VC and AdvantEdge Partners. The fintech company had previously secured $1 Mn in a Bridge round from DSG consumer Partners and angel investor Siddharth Parekh, who is also currently a partner at Mumbai-based private equity firm Paragon Partners.
Prior to that, in October, Hyderabad-based Tazzo Technologies, a tech-enabled motorbike rental platform, raised about $225K (INR 1.5 Cr) Seed funding from DSG Consumer Partners. It was reported that the startup would be using the funds to enhance technology, build a fleet and expand into multiple cities.
In February of the same year, packaged juice brand Raw Pressery raised $4.5 Mn in a Series B round at a similar valuation from Sequoia Capital, Saama Capital Management and DSG Consumer Partners. It later secured $543K (INR 3.5 Cr) funding from Bollywood’s Jacqueline Fernandez.
Future Plans Of DSG Consumer Partners; New Fund DSGCP Tyeb
DSG Consumer Partners is currently looking to raise a new VC fund, DSGCP Tyeb, for investing in Series B/C/D stage consumer startups. As revealed by Shahdadpuri, the VC fund will have a corpus of around $20 Mn and has already made its first close of $16 Mn.
Shahdadpuri added, “DSGCP I continues to perform exceedingly well. DSGCP Tyeb offers investors wanting later stage exposure to more mature companies, the opportunity to back the best performing and fastest growing startups from the first fund. DSGCP Tyeb will only invest in a subset of DSGCP I companies in new rounds led by external investors.”
In the last few years, DSG Consumer Partners has also made multiple exits. Under the DSGCP I fund, the firm announced a complete exit from Redmart and Twitter-acquired “missed call” startup Zipdial at 3.3X return. It has also made partial exits from Veeba Foods and OYO for returns of around 6.5X and 11X respectively.
Through its strategic exits, DSG Consumer Partners has already raked in more than $11 Mn out of its initial $13 Mn investment under the DSGCP II VC fund. Other VC firms that have announced the first or final close of their funds in the last several months include IDG Ventures, Stellaris Venture Partners, Endiya Partners and Fireside Ventures, among others.
(The development was reported by Livemint)