Investing in over a dozen of startups in India, the Silicon-Valley-based, Lightspeed Venture Partners is raising $115 Mn (INR 734 Cr) India-specific fund. The Venture Partner which was investing from its global fund till now has raised the specific funds as it looks to double down on the country’s booming startup ecosystem.
The plans were formalised through a disclosure with the US capital market regulator, Securities and Exchanges Commission (SEC).
Indian startups have raised over $1.7 Bn in Q1 of 2015 with only 12.9% raised by enterprise software company. However, as Dev Khare, MD, Lightspeed, retorts that top 30 B2B software product companies in India are worth $6 Bn and employ nearly 20,000 people. Hence, the Lightspeed team is poised to fuel the startup ecosystem in India and is committed to invest in both consumer and enterprise technology. Prior to this LightSpeed had raised $950 Mn last year in its 10th global flagship fund which was being used as the investment bank.
Lightspeed Venture Partners has been investing in India since 2004 focusing on direct and cross-border businesses. The firm generally invests $1 to $25 Mn in growth or early-stage startups seeking to disrupt or transform large markets in the domestic economy. Bejul Somaia and Dev Khare led Lightspeed Venture Partner has invested in over quite a few startups like Vee, Crafstvilla, Limeroad, LocalOye, PhoneWarrior, ITzCash, Fashionana and Dhingana across advertising and media, business services, financial services, healthcare, education and retail domains.
With the complete portfolio of over 200 investments till date, Lightspeed has invested in two startups in India this year so far. The firm invested INR 31 Cr in Internet-first restaurant, FreshMenu and $5 Mn in local service startup, LocalOye along with Tiger Global Management.
A VC investor familiar with Lightspeed’s India plans told ET, “Lightspeed has a very good reputation in Silicon Valley as an early-stage investor. The key for them will be support of the US office, which can really fasten the fundraising process in India.”
Along with Lightspeed, there are other Silicon Valley-headquartered venture capital firms viz Sequoia Capital, Accel Partners, Mayfield and Matrix Partners which have set up offices in India and invest through separate India-dedicated funds. However, Bessemer Venture Partners and Norwest Venture Partners invest from a global pool.
2015 is retorted to see a rise in the venture capital fundraising in India. It is expected that at least a dozen VC investors will raise close to around $3 Bn this year. Recently, Sequoia Capital raised $210 Mn fund to create the single largest pool of VC fund ever for India. Accompanied it was Mayfield that raised $108Mn for its second India fund, Lighthouse that raised $125 Mn for its local fund, SAIF Partners with a raise of $350 Mn and Accel Partners that raised $305 Mn for its fourth India fund.
With this snaring of funds Silicon Valley based Canaan Partners was an exception that sold its India portfolio to JPMorgan. Besides, Helion Venture Partners, Kalaari Capital, Blume Ventures, Nexus Venture Partners, IDG Ventures are some of those who are planning a raise of their new funds.
The firms mentioned above have diversified investment strategy investing in domains like consumer and infrastructure. As internet penetration increases along with the growth of smartphone market the fast burgeoning startup landscape is on a look out for investors that can trust them and build them.