Lightspeed Venture Partners Closes Second India Fund At $175 Mn

Global VC firm Lightspeed Venture Partners has closed its second India fund with a corpus of $175 Mn. The Silicon Valley-based firm is now looking to invest in another batch of early-stage startups.

The investors in Lightspeed’s second India fund include limited partners (LP) and companies that invest in venture capital firms in the US and East Asia.

“LP interest in the second India fund is a reflection of an increasingly diverse opportunity set in India. Five years ago, there were mostly consumer ecommerce startups. Now, there is a wide array of opportunities including content and media, B2B marketplaces, B2B software, fintech and others,” said Bejul Somania, managing director at Lightspeed India.

With the close of its second India fund, Lightspeed’s total capital under management in the country stands at $310 Mn. This includes a $115 Mn India-specific fund, raised in 2015 to invest heavily in India’s burgeoning landscape.

Lightspeed Venture Partners via Lightspeed India has been investing in India since 2004, with a focus on direct and cross-border businesses. It generally invests $1 to $25 Mn in growth or early-stage startups seeking to disrupt or transform large markets in the domestic economy. The venture also cuts larger cheques with its US fund.

“Our strategy remains the same — seed and Series-A deals,” said Dev Khare, a partner at Lightspeed India Partners Advisors.

According to Dev, new spaces have opened up and there is an opportunity to continue to go in early and help startups build their management teams and guide them through the strategy that will fit the India market, as opposed to the ones borrowed from the US or China markets.

Lightspeed Venture Partners has some of the most notable startups in its portfolio including OYO Hotels, BYJU’S (which recently acquired a unicorn status), and ShareChat among others. From its first $135 Mn fund, the firm made 20 investments including the $50 Mn funding in Udaan, a marketplace for businesses.

From its second India fund, it is expected to make around 25-30 startup investments, at the same time looking for a few “opportunistic” deals at the Series B and C stages.

Apart from Khare and Somaia, Lightspeed has three other partners: Akshay Bhushan, Harsha Kumar and Vaibhav Agarwal. The firm has also appointed former Andreessen Horowitz executive Hemant Mohapatra as its sixth partner. Mohapatra will join Lightspeed Venture Partners in August this year.

Going ahead, other venture capital firms such as Sequoia Capital, Nexus Venture Partners and Inventus Capital, are expected to raise their next funds this year.

[The development was reported by LiveMint.]