3one4 Capital, an early-stage venture capital investor, raised $200 million for its fourth fund to invest in technology-driven startups. The firm raised capital from domestic and international investors and has over $750 million in assets under management, senior company officials said.
At a time when the funding winter is intensifying, India-focused funds continue to gain traction, a sign of a maturing ecosystem and significant investor interest in the region. This is the third India-focused fund in the last fortnight to announce its final close after private equity investors Multiples Alternate Assets Management and Chiratae Ventures.
The fund that was oversubscribed had to limit its size to $200 million to pursue the investment discipline that management aims to follow, said Pranav Pai, founding partner and chief investment officer at 3one4 Capital. “For us, to be a focused early-stage investor and maintain our performance levels, $200 million seems to be the optimal fund size,” Pai added.
Its backers include banks, mutual fund operators, US university endowments, global sovereign funds, global corporations, and insurance companies among others. Fund IV is made up of more than 90% institutional investors, the firm said. While the capital split is equal between rupee and dollar investment, it will be the firm’s debut fund at GIFT IFSC. It will also be its first offshore vehicle.
3one4’s approach is contrary to what most of its competitors are doing, which is raising larger funds and writing larger checks or investing longer in successful portfolios.
“We give our LPs the option of direct investment in our portfolio firms, which allows them to support our investments longer through their subsequent rounds,” Pai added.
The VC firm was founded by Pai and his brother Siddarth, who raised six funds so far. In total, the firm will manage ₹3,710 crore ($510 million) of committed capital and over ₹6,000 crore ($750 million) in assets under management. Anurag Ramdasan and Nruthya Madappa are the other two partners in the firm.
In addition to Licious, Darwinbox, Open, BetterPlace, Jupiter, KukuFM, Koo, Dozee, and Tracxn, the firm has already begun deploying from its new fund. It has invested in five deals, said Ramdasan.