Mayfield raising second India-focused VC fund

Silicon Valley-based venture capital firm Mayfield Fund is in the process of raising its second India-focused VC fund. Mayfield is one among a clutch of international VC firms who have India-dedicated investment funds, as against another set who invests in Indian firms out of global or regional investment funds.

Mayfield has registered Mayfield India II Ltd with the US Securities & Exchange Commission (SEC) to raise the VC fund. It has not disclosed the target amount but said it expects to complete the fundraising within a year.

The firm is yet to secure any capital for its Mayfield India II fund, according to the filing. VC and PE firms typically scale up the size of a new offering, compared with their previous funds, which means Mayfield India II could be eyeing over $100 million.

Mayfield India II will be the successor to Mayfield India I, which raised $111 million in late 2008 and the VC firm has been investing in the country through this fund.

Although Mayfield is a technology-focused investor in Silicon Valley, it has also been an active venture investor in non-technology companies in India. It is not yet clear if the firm will continue with the same investment strategy as far as the new fund goes.

When contacted by VCCircle, Mayfield India’s Vikram Godse declined to comment on the development.

In an interview with VCCircle last year, Godse had said, “LPs have realised that early-stage investing has come of age in India. More importantly, they have also realised that it’s not only early-stage technology firms but also early-stage non-technology firms where opportunities are.”

The new fund comes a year after Mayfield exited Fourcee Infrastructure Equipment, the bulk logistics solution provider, with 10x returns when the company raised $104 million from private equity major General Atlantic. Another portfolio company, Centum Learning (a skills development arm of the Bharti Group), was also acquired by Everonn Education.

Mayfield’s portfolio companies include Bharat Matrimony (India’s largest matrimony company), Dealsandyou (a daily deals portal), Geodesic Techniques (a specialty construction company), Sohanlal Commodity Management (an agriculture logistics company) and Genesis Colors (a high-end apparel company). Some of its earlier investments include PayMate India and Tejas Networks. Mayfield typically invests between $5 million and $15 million in its portfolio companies with revenues ranging between $5 million and $50 million.

Mayfield has over $3 billion under management and currently, it is investing out of Mayfield XIV, a $365 million fund focused on venture investments in the US.

Other large venture capital firms in the country include Helion Venture Partners (recently raised $255 million in its third VC fund), Matrix Partners India ($600 million across two funds), Nexus Venture Partners ($590 million across three funds) and Accel ($225 million across three funds), among others. Inventus is also on the road for its second India-focused VC fund.

The past 12 months have been the best for India in terms of early-stage fundraising. Seven venture capital firms have already raised $943 million for India-dedicated funds in the past one year (since November 2011), with several others still on the road and expecting fund closures in the coming months.

The previous fundraising cycles of existing VC firms had been in 2007-08 when they raised around $900 million (2007) and $522 million (2008), according to VCCEdge, the data research platform of VCCircle.

(Edited by Sanghamitra Mandal)

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