Venture capital firm Iron Pillar, which has invested in companies such as FreshToHome, Uniphore, Servify, and CureFoods, on Wednesday said that it has marked the close of its Global Cloud Fund II with a corpus of $129 million.
The new fund is a part of the Iron Pillar Fund II series of funds, which will likely have multiple other vehicles. “We are in the early stages of discussions with investors on one other vehicle for Fund II,” said Anand Prasanna, managing partner of Iron Pillar.
The growth stage-focussed investor raised the capital from existing institutional investors from the US, Europe and the Middle East as well as from new investors including two endowments and a foundation. Existing investor 57 Stars LLC was the only limited partner it disclosed for the new vehicle.
The cloud fund, as the name suggests, will invest in Series B and C rounds of cloud software companies or software-as-a-service (SaaS) firms from India that sell their services globally. The fund’s deployment is led by Prasanna and Mohanjit Jolly.
“We are concentrated investors. We don't invest in more than 8-10 companies. This fund would be the same,” Prasanna said, reiterating the fund’s thesis of backing companies building in India for the world.
To be sure, for the past several years, Iron Pillar has focused its investments on software companies. Its portfolio already includes the likes of Uniphore, Servify, CoreStack, Ushur, Jiffy, Sibros, and Pando.
"Iron Pillar is built on a fundamental belief that Indian founders will build large technology companies not only for India, but also for global markets,” said Prasanna, adding that the global cloud opportunity is growing at an unprecedented pace, and the fund believes that Indian founders will continue to build some generational businesses in this space.
SaaS companies built in India have generated $12 billion in annual recurring revenue (ARR) in 2022, up four times over the past five years, as per data from Bain & Company. The firm expects that the collective ARR of Indian SaaS firms will reach $35 billion in the next five years. “Iron Pillar is poised to leverage this mega-trend with our latest fund,” said Prasanna.
Founded in 2016, Iron Pillar usually leads Series B or C rounds in its portfolio companies and later doubles down on the breakout businesses with 5x to 10x of its initial investment.
It currently has nearly $500 million in assets under management, which includes its $300 million in Fund I series, $129 million under the global cloud fund and several special purpose vehicles.