Chicago-based venture capital fund and accelerator EVC Ventures has made a quick exit from micro-delivery grocery startup Milkbasket with high returns, the company said.
The venture capital firm achieved an internal rate of return (IRR) of 200% on the one-year investment in Milkbasket, when it recently sold its stake to early-stage venture capital firm Blume Ventures and technology major Lenovo, a company statement said.
Milkbasket, which is operated by Gurgaon-based Aaidea Solutions Pvt. Ltd, had raised $500,000 (Rs 3.3 crore) in a pre-Series A funding round led by venture capital firm EVC Ventures in April 2016. The round had also seen the participation of other notable investors from China and India.
The deal also marks Lenovo’s maiden investment in an Indian startup through its venture capital arm Lenovo Capital and Incubator Group.
The company was founded in 2015 by INSEAD alumnus Anant Goel, along with Ashish Goel, Anurag Jain and Yatish Talavadia. The asset-light startup, which initially only delivered milk, aims to fulfil the daily grocery and household needs of customers.
As an investor, EVC Ventures had helped align the company’s finance, technology, sales, and marketing plans and had assigned an operating partner to manage its weekly sprints, the statement said. It had also facilitated subsequent rounds of fundraising for the company.
The VC firm is a $50-million fund focused on early-stage investments in ad-tech, e-commerce, gaming, education, mobile apps, enterprise software, wearables and Internet of Things.
The hyperlocal delivery segment has continued to see investor interest, even as a number of startups in the space have fallen by the wayside.
While US technology giant Amazon have a presence in the hyperlocal delivery space with Amazon Now, another major startup, Bengaluru-based ZN Retail Pvt, Ltd, which runs online grocery property ZopNow, had raised $10 million in 2015 from San Francisco-based Dragoneer Investment Group with participation from existing investors Accel Partners, Qualcomm Ventures and Times Internet.
However, on the flipside in March, Chennai-based hyperlocal delivery startup Genie Solutions Pvt. Ltd had to shut shop after failing to raise funds.
Over the past year-and-a-half several other startups, including well-funded ventures like PepperTap and LocalBanya, had to down their shutters.
The seed-stage VC firm, which is investing out of its second fund that was closed last year, has been the most prolific backer of startups in India this year.
Mumbai-based Blume not only sealed the most number of deals – 10 overall – in the first half of 2017, but also added the most new firms – five – to its portfolio, according to VCCEdge, the data research platform of News Corp VCCircle.
Its new investments include Bengaluru- and US-based Minjar Cloud Solutions Pvt. Ltd, which operates a cloud computing platform, and San Francisco- and Delhi-based software-as-a-service (SaaS) startup Squad.
It has a portfolio of over 75 startups, including MockBank, IDfy, GreyOrange, RailYatri, RoadRunnr, ReGlobe, Tookitaki, Purplle, Zopper and NowFloats. Such large investment portfolios have been rare in India, except for the likes of, say, a Sequoia Capital, which has been investing here for over a decade. A large portfolio often creates fertile ground for bigger investors to scout for opportunities. And Blume seems to be doing just that.