IvyCap Ventures Marks First Close Of Fund III At INR 1,608 Cr; Targets INR 2,000 Cr

Mumbai-based growth-stage venture capital (VC) IvyCap Ventures has raised INR 1,608 Cr, making the first close for its third fund. The fund targets a final close of INR 2,000 Cr; however, looking at the demand and the fund strategy, it may increase the size to INR 2500 Cr.

Two-thirds of Fund III has been raised from its existing investors, while new ones include institutional investors such as banks, insurance companies and government departments and even some family offices.

The VC firm, which invests in Series A stage of Indian startups, plans to continue investing in consumer internet, deeptech, healthtech, fintech, SaaS and edtech startups. It will have an average cheque size of INR 30 Cr- INR 40 Cr as its first cheque in 20-30 Indian startups.

Additionally, IvyCap Ventures will reserve around 20% of the corpus for co-investing in its existing portfolio from Fund II. The balance funds will be reserved as a follow-on to the entire portfolio.

Founded in 2011 by Vikram Gupta and later joined by Ashish Wadhwani, Vishal Gauri and Anju Gupta, IvyCap Ventures manages a portfolio of more than 30 companies. It has already made successful exits in six companies including a partial exit in HR tech startup Purplle in 2021, where its Fund 1 saw a 22x cash return for its investment.

IvyCap Ventures’ previous two funds closed at INR 240 Cr and INR 535 Cr in 2014 and 2020 with investments in 10 and 23 startups, respectively. Some of the companies in its portfolio are Purplle, Clovia, BlueStone, Biryani by Kilo, Convosight, Miko, Elucidata, ftcash, among others. Its recent exits include Pharmarack and Leixir.

Recent investments in portfolio companies Miko and Biryani By Kilo have been made from Fund III.

Indian Startup Funding At All-Time High

The Indian start-up ecosystem presents a blossoming opportunity for global investors. Indian startups have surpassed the total investment it saw in 2020 when venture funding totalled $33.8 Bn, raising $42 Bn in 2021.

In 2021, Indian startups raised $42 Bn in over 1,583 funding deals with an average ticket size of $32 Mn. Further, since 2014, India houses over 57K startups, who have cumulatively raised over $112 Bn in funding and this is growing exponentially year on year. This includes 85+ startups that are in the unicorn club (valuation > $1 Bn), and 17 startups getting listed on the stock exchanges.

While late-stage funding has grown 3.6x from 2020 to 2021, enabling a large amount of funding inflow, the amount of growth-stage deals has grown by almost 3x, as well. Primarily these startups are backed by VC firms with fund sizes over $100 Mn such as Leo Capital, Stride Ventures, Prime Ventures, Kalaari Capital, Blume Ventures, Matric Partners, 3One4 Capital, agritech-focussed Omnivore, Chiratae Ventures, among others.