Next Orbit Ventures Announces $750 Mn Fund To Invest In ESDM Startups

Next Orbit Ventures Fund will focus on creating a manufacturing hub in India for Electronic System and Design Manufacturing (ESDM) sector including semiconductor chips, solar and LED components. The NOVF, backed by Next Orbit Ventures, has announced the launch of its second fund called ‘$750 Mn dollar Fund II’ to fuel the fresh venture.

The fund, totalling $750 Mn (INR 4875 Cr.), will be used to invest in semiconductor fabrication (fab), fab science park, solar and LED fab, IoT, healthcare and other ESDM products. Out of $750 Mn fund, about $160 Mn (INR 1040 Cr.) will be invested in one of the consortia, mandated by the central government to create a wafer fab plant.

“The fund is meant for long term of over 7 years, and we will invest different ticket size based on the requirement. Fab investments will be in the range of $100 Mn (INR 650 Cr.) as these are high end large scale investments. We are also looking at startup investments with a ticket size between $5 Mn (INR 32.5 Cr.) and $30 Mn (INR 195 Cr.),” said, Ajay Jalan, founder & MD of Next Orbit Venture Fund.

Currently, five startups have been shortlisted for funding, the names of which will be announced in December. The firm has also announced that its 19 portfolio companies, from its first fund worth $140 Mn, will be listed on the SEBI promoted Institutional Trading Platform to better improve transparency and enable exits.

“We feel that the third industrial revolution in India after automobile manufacturing and IT will be in the ESDM sector. The current initiatives by the government on Digital India and Make In India will further boost this sector as currently we are importing $90 Bn (INR 580000 Cr.) worth of electronic components,” added Jalan.

The first fund had been used in making sector-agnostic investments in consumer products & services and internet & technology support services; the firm has invested INR 300 Cr. so far. Next Orbit Ventures Fund is looking forward to make similar investments in mobile and tech companies, which would in turn increase the demand for the ESDM sector.

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