SUMMARY
Together Fund II will invest $1 Mn-$5 Mn in seed and Series A rounds of SaaS and AI startups
Together Fund, which was focussed on SaaS so far, is now exploring startups in AI; over the last three months, it has invested in three generative AI companies
Kula, Privado, Revenue Hero, Spendflo, Spry, and Toplyne are among the portfolio startups of Together Fund
Bengaluru-based Together Fund on Thursday (July 27) announced the first close of its $150 Mn second early stage fund, Together Fund II, which is focused on SaaS and AI startups.
The fund has attracted interest from institutional investors in the US and Asia. Together Fund II will invest $1 Mn-$5 Mn in seed and Series A rounds of startups, the VC firm said in a statement.
“Raising our second fund speaks to the remarkable progress of our existing portfolio and the technology ecosystem in India, even amidst challenging funding and macroeconomic conditions,” said Manav Garg, founding partner of Together Fund.
“The bright spot ahead in the business landscape is AI and we believe it’s becoming an increasingly indispensable asset for every enterprise to revolutionise existing solutions and deliver unprecedented value to customers,” Garg added.
In 2021, Together Fund, which claims to be a founder-first venture capital fund, had announced an initial corpus of $85 Mn for SaaS startups. The VC firm was launched by Girish Mathrubootham, the founder and CEO of Freshworks, Eka Software’s founder and CEO Garg, ex-Matrix Partner Shubham Gupta, and Avinash Raghava, ex-Accel.
Earlier this year, Raghava stepped down from his role as a partner of Together Fund.
Together Fund said that in just two years, it has engaged with over 1,700 startups and invested in 20 founding teams across horizontal application areas like recruitment, sales intelligence, and marketing, vertical Saas companies in healthcare and those startups that are creating new categories like cloud for connected devices.
Its portfolio ranges from first-time founders to experienced entrepreneurs, and includes startups from major hubs like Chennai and Bengaluru to companies in tier-II cities like Surat. A few of its portfolio companies – Kula, Privado, Revenue Hero, Spendflo, Spry, and Toplyne – have also successfully raised follow-on funding rounds from several global investors.
Focused only on SaaS so far, Together Fund now wants to reap the benefits of the breakthrough opportunities that AI is creating for startups. The pace of change is exponential and early pioneers can create and capture entire markets within weeks, if not months, the VC firm believes.
“In light of this once-in-a-generation SaaS and AI opportunity, we are extending our founder-first philosophy with our second fund, supporting founders from the inception stage of their journey,” said Mathrubootham, founding partner of Together Fund.
Over the last three months, Together Fund has already invested in three generative AI companies in healthcare, developer infrastructure and modern marketing stack to serve as early stage partners to some AI-first founders, the firm said.
Despite the funding winter, several VC firms have seen their funds close in the past few months. The VC arm of Singapore’s Temasek, Vertex Ventures, reportedly marked the first close of its Vertex Master Fund III at around $900 Mn last month.
In June this year, Blume Ventures saw the first close of its new opportunity-cum-continuity fund, Fund 1Y. Earlier, 3one4 Capital closed its fourth early stage investment fund, Fund IV, at $200 Mn, while Chiratae Ventures announced the final close of its maiden fund. Aeravti Ventures also announced the first close of its maiden fund.
Meanwhile, as funding winter continues, startup funding plunged to $5.4 Bn in H1 2023 as against $19 Bn in the corresponding period of last year, as per Inc42’s report.
