IDFC Alternatives, the private equity arm of IDFC group, is partnering with venture capital firm Parampara Capital to launch an early stage fund targeting at innovative startups, it said in a statement.
The fund, IDFC Parampara Early Stage Opportunities Fund – Series I, seeks to make Series A investments in companies across sectors where technology, intellectual property and innovation are primary differentiators.
Through this Rs 100 crore (around $14.7 million) fund, IDFC Alternatives—which is a 100% subsidiary of IDFC and an advisor and investment manager of IDFC-sponsored funds across private equity, infrastructure and real estate—has entered the early stage investing space. Parampara Capital is the investment manager to the fund.
IDFC Alternatives will have a strategic commitment to the fund including participation in the fund’s investment committee and advisory board, it said in the statement.
MK Sinha, managing partner & CEO, IDFC Alternatives, said, “Our partnership with Parampara allows us to back entrepreneurs at an early stage. We are confident that we will be able to achieve healthy returns as well as contribute to the startup ecosystem.”
Venkat Vallabhaneni, general partner at Parampara Capital, said, “Their (IDFC) financial services expertise in India and particularly their private equity investment experience will add a lot of value and help IDFC-Parampara fund to become a leading technology early stage capital fund in India”.
Jatin Desal, another general partner at Paramapara Capital said, “The partnership will help the fund in identifying fintech opportunities in India for investments and also extend IDFC ‘s domestic and global investor base interested in investing in the technology early stage capital space in India”.
IDFC-Parampara Early Stage Opportunities Fund, with offices in Mumbai and Hyderabad, was launched in August 2015 by Vallabhaneni, Desai and Sridhar Rampalli.
Early this week, IDFC Alternatives said it has marked the first close of its fourth private equity fund at $100 million. The firm’s target for the fourth fund is now at $300 million, which is lower than previous estimates, partly due to the depreciation of the rupee. It aims to close the fund by the year-end, Girish Nadkarni, partner, private equity, IDFC Alternatives had said.
Around one-third of the corpus from fund IV is earmarked for platform investments, which is a build-out as opposed to a buy-out strategy.
IDFC Alternatives has assets under management of approximately Rs 17,000 crore.
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