Early stage venture capital fund Unicorn India Ventures (UIV) has announced the first close of its INR 1,000 Cr Fund III at INR 225 Cr. The VC firm is looking to close the fund by March 2024.
Unicorn India Ventures plans to back 25 startups focused on global SaaS and digital platforms through this fund. Fund III is looking at newer sectors of climate tech, agritech, spacetech and the semiconductor ecosystem.
Fund III would look at investing a first cheque of around $1 Mn – $2 Mn and would then look to invest in the follow-on round. As a part of its investment thesis, UIV invests only 20% of its investible corpus to create the portfolio and the rest to back the winners of the portfolio.
Started in 2016 by Bhaskar Majumdar and Anil Joshi, Unicorn India Ventures launched Fund II, an INR 300 Cr fund in 2020, with its first fund coming in 2019. With two funds under management, Unicorn India Ventures has an active portfolio of over 35 startups. According to the firm, the internal rate of return (IRR) was more than 60% year over year for its first fund.
Bhaskar Majumdar, managing partner of Unicorn India Ventures, said, “Being the first institutional investors, before making any investment we spend considerable time with the founders to understand their vision, team’s capabilities, growth plans and leadership style. Our focus is to invest in companies that are enablers of India’s digitisation across sectors. We avoid high cash burn businesses like D2C, Consumer Internet and content businesses.”
Unicorn India Ventures has also announced senior hiring for Fund III. Former Aavishkaar Group partner Bikram Mahajan is joining as a partner, while former Edelweiss AVP Kamlesh Ahuja is joining as VP (fund operations).
Anil Joshi, managing partner of Unicorn India Ventures, added, “Our key differentiator is that we are present across India and believe that India’s startup landscape has changed immensely over the past couple of years. With this third fund, our commitment to nurture Indian startups will be unwavering and we will keep scouting for highly innovative companies whose disruptive solutions can address real-life problems of users by leveraging technology.”
Joshi added that more than 60% of the VC firm’s portfolio startups come from emerging regional hubs like Kochi, Jaipur, Ahmedabad, Pune and Hyderabad. “Unicorn is perhaps the only fund that has worked tirelessly with the state governments in Kerala, Orissa, and Madhya Pradesh to roll out a startup policy to find high-potential startups from Tier II and III cities,” Joshi added.
Through its first and second fund, Unicorn India Ventures has backed startups such as neobanking unicorn SmartCoin, Open Bank, Sequretek, Pharmarack, Genrobotics, Clootrack, Probus and Gamerji.
The VC firm’s first close of its third fund comes as investors active in India have been stockpiling dry powder to invest in Indian startups. According to data compiled by Inc42, funds worth nearly $4 Bn have been launched or announced in India since the start of 2023.
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