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IDG Ventures India marks final close of third fund

07 March, 2017

Venture capital firm IDG Ventures India has marked the final close of its third fund, meeting its targeted corpus of $200 million (around Rs 1,332 crore), according to a media report.

This comes a little over a month after World Bank’s private investment arm International Finance Corporation (IFC) proposed to invest $20 million (around Rs 136 crore then) in IDG Ventures India’s third fund.

The venture capital firm raised 55% of the third fund from foreign investors and the remaining from domestic investors, DealStreetAsia reported, citing the firm’s founder, chairman and managing director Sudhir Sethi.

An email query sent to Sethi did not immediately elicit a response.

IDG Ventures India’s third fund, which is registered as IDG Ventures India Fund III LLC with the US Securities and Exchange Commission, seeks to focus primarily on Series A and B investments.

It looks to invest in technology and technology-enabled companies in India across consumer internet, software, health-tech and fin-tech sectors.

The new fund is the successor to IDG Ventures Fund II, which was floated in 2013 to raise $175 million. The second fund, however, did not manage to raise the targeted amount and ended with Rs 600 crore (around $100 million then) in November 2014.

In 2007, IDG Ventures Fund I had raised $150 million.

IDG Ventures India typically invests between $0.5 million and $10 million in startups. Its portfolio includes companies such as Lenskart, Zivame, Aasaanjobs, Firstcry.com, Forus Health, Perfint Healthcare, SilverPush, SuperProfs, Uniphore, Vserv and Xpressbees.

IDG Ventures India is part of IDG Ventures, a global network of technology funds with about $4 billion under management. The Indian venture capital firm was floated by Manik Arora, Sudhir Sethi and TC Meenakshisundaram nine years ago. Arora quit the firm in 2015.

On Monday, IDG Ventures India and Bangalore-based startup accelerator Axilor Ventures said they are partnering to launch a programme to discover and fund early-stage startups in frontier tech sectors.

Mushrooming VC funds

The venture fund’s fundraising comes at a time when several other VC firms in the country have also mobilised funds or are in the process of doing so.

Most recently, early-stage venture capital firm Endiya Partners  made the final close of its debut fund at Rs 175 crore (around $26 million).

In November last year, Infosys Ltd said it will invest in the maiden fund of home-grown early-stage venture capital firm Stellaris Venture Partners, which was launched by three former executives at Helion Venture Partners.

In September last year, early stage venture capital firm YourNest launched its second fund, YourNest India Fund II, with a target of raising Rs 300 crore.

Besides, the founders of Mumbai-based co-working space provider and startup accelerator Z Nation Lab said last year it was planning to launch a seed-stage venture capital fund to back technology firms. 

In October last year, Ventureast Fund Advisors India Ltd announced the first close of its sixth fund—Ventureast Procative Fund II (VPF2)—at $83 million en route to a target corpus of $150 million in total.

Unitus Seed Fund was also looking to mark the first close of its $50 million second fund by the end of 2016.

In August, LetsVenture founder Manish Singhal floated an early stage venture fund called Pi Ventures with entrepreneur Umakant Soni.

Inventus Capital Partners and Kalaari Capital are also looking for investors for their new funds.

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IDG Ventures India marks final close of third fund

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