SUMMARY
The venture fund will continue to back startups that have already raised VC funding and provide them with a range of speciality debt solutions of up to INR 200 Cr for each company
Alteria Capital Fund III venture debt scheme will back around 100-125 companies and deploy the entire capital by December 2026
Alteria Capital Fund III is expected to raise $250 Mn-300 Mn in total as an aggregate of the venture debt scheme and a shorter duration scheme
Mumbai-based venture debt fund Alteria Capital announced the final close of its third venture debt fund at INR 1,550 Cr (over $190 Mn).
Alteria Capital Fund III venture debt scheme had a target size of INR 1,000 Cr with a green shoe option. The fund was significantly oversubscribed, with over half of the fund being contributed by existing investors, Alteria said.
The venture fund will continue to back startups that have already raised VC funding and provide them with a range of speciality debt solutions of up to INR 200 Cr for each company.
Speaking to Inc42, Vinod Murali, cofounder and managing partner of Alteria Capital, said that the new fund has already deployed 50% of the total capital commitments. Overall, the fund will back around 100-125 companies and deploy the entire capital by December 2026, he said.
Alteria Capital Fund III counts startups like One Card, Renee Cosmetics, Samunnati, Bliss Club, Rebel Foods, Giva, Lead School, Kissht, Captain Fresh, Traya, Bluestone, and Ather in its portfolio.
It is pertinent to note that Alteria Capital has adopted a twin scheme strategy as part of its third fund, which includes the venture debt scheme and a shorter duration scheme to cater to the various capital needs of the Indian founders.
The company recently told Inc42 that it was planning to raise $80 Mn to $100 Mn for the shorter duration scheme for the third fund by FY25. Alteria Capital Fund III is expected to raise $250 Mn-$300 Mn in total as an aggregate of the shorter duration scheme and the venture debt scheme.
“…the strategy to split our fund into two schemes with different propositions arises from the fact that startups need innovative solutions across different use cases, tenors and price points. We wanted to align our investors to these expectations and ensure that the founder-LP fit is appropriately designed,” Murali said in a statement.
Founded by Murali and Ajay Hattangdi in 2017, Alteria Capital has total asset under management (AUM) of INR 4,350 Cr and has deployed INR 5,400 Cr in total across its three funds so far. It boasts a portfolio of around 190 startups, including Dealshare, BharatPe, Jupiter, Cars24, and Zepto.
Despite the macroeconomic volatility, Alteria Capital said, the latest fund saw strong interest from domestic investors, including institutions, large family offices, senior professionals, and founders.
It is pertinent to note that the total funding raised by the Indian startup ecosystem stood at $10 Bn in 2023, a sharp 60% decline from 2022 and a 76% fall from 2021 due to the funding winter.
Currently, India is home to over 50 venture debt funds, and over 200 startups have raised debt funding since 2015.
