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SAIF Partners raises $350 mn for new fund

28 July, 2017

Venture capital and growth equity investment firm SAIF Advisors Pvt. Ltd has raised $350 million (Rs 2,247 crore) for a new fund, media reports said on Friday.

The development comes about a month after VCCircle reported that the firm had floated its sixth fund, SAIF Partners India VI Ltd.

The new fund is the firm’s third India-focussed vehicle, and its size is almost the same as its previous two India funds.

The firm had made the final close of its fifth fund at $350 million in March 2015.

Deepak Gaur, managing director at the VC firm, told The Economic Times that the new fund’s investment strategy will be the same as that of previous funds.

The VC firm will continue to make seed, Series A and growth-stage investments, Gaur said. It expects to invest around 20% of the fund in listed firms.

An email sent to SAIF Partners seeking details of the fundraising did not elicit any response.

SAIF Partners has built an active public equities portfolio, which includes chemicals company Atul Ltd, luxury watch retailer and components maker KDDL Ltd and automotive lighting and signalling equipment maker Fiem Industries Ltd.

The new fund also intends to make Series B investments with a cheque size of $15 million.

Gaur also said that the VC firm aims to be more active in sectors such as enterprise software, software-as-a-service, education, healthcare and consumer brands.

The venture capital firm chases investments in sectors such as consumer products and services, technology, media, education, telecom, financial services, healthcare, travel and tourism, and manufacturing. It typically invests between $2 million and $75 million in one or more rounds in its portfolio companies.

SAIF Partners joins peers Sequoia Capital and Accel Partners in raising fresh capital in recent months, underlining the robust startup environment in the country, despite a drop in VC dealmaking in 2016 from its peak the previous year.

In June, global venture capital firm Sequoia Capital had topped up its fourth India-focussed fund for the second time by $125 million after closing its first India fund worth $920 million only a year ago.

In December last year, Accel Partners had raised $450 million for its fifth fund to make seed and early-stage investments in Indian startups.

On the flip side, worries over mounting undeployed capital raised by VC firms are also growing.

The total dry powder, or investible capital, with PE and VC funds has soared to Rs 45,416 crore. This excludes multi-billion-dollar corpuses available with large global PEs and VCs that are not registered in India.

SAIF Partners has assets under management of $2 billion. However, its India-only funds will be about $1 billion, given that the first three funds also invested in other regions.

SAIF Partners has been investing in India for over a decade and prides itself for having taken a bunch of private firms, including MakeMyTrip Ltd and Just Dial Ltd, to the public market.

It has also backed mobile wallet company Paytm, which had raised a whopping $1.4 billion (about Rs 9,000 crore) from Japan’s SoftBank Group Corp, in the largest funding round from a single investor in India in May.

In its recent major exit, SAIF Partners had sold its remaining stake in MakeMyTrip during the October-December 2016 quarter for about $150 million, according to VCCircle estimates. With this, SAIF Partners had generated about $400 million, or about 16 times the money it had invested in tranches in MakeMyTrip, since the first stake sale in 2010.

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SAIF Partners raises $350 mn for new fund

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