Avendus, the highest funding financial institution for enterprise offers in India, confirmed on Wednesday it’s seeking to increase as much as $350 million for its new non-public fairness fund.
The brand new fund, referred to as Future Leaders Fund III, will allow the Mumbai-headquartered agency to jot down bigger checks and preserve a significant place within the startups it backs, mentioned its managing associate Ritesh Chandra in an interview with TechCrunch. TechCrunch reported in early April that Avendus was placing collectively a plan to lift a brand new fund.
A daily fixture in most growth-stage offers in India, Avendus has established itself as the most important enterprise advisor for startups within the nation. It supplied providers in over 30 offers final 12 months, together with merger and acquisition transactions, in response to Enterprise Intelligence, a personal market perception platform. The rising dimension of its non-public fairness unit underscores the agency’s ambitions to increase its tentacles much more deeply into the ecosystem and see extra upside from the winnings.
The agency’s rise to prominence was aided by the truth that lots of its well-established world rivals, equivalent to Goldman Sachs, Morgan Stanley, and JP Morgan, initially paid much less consideration to the Indian market, permitting Avendus to achieve a foothold and construct relationships with the nation’s burgeoning tech entrepreneurs.
These relationships are additionally serving to the agency’s non-public fairness unit to achieve entry to a number of the high-profile offers. Except for lead backer SoftBank, the monetary providers startups Juspay and Zeta have allowed solely Avendus on their cap tables, for example. “These are companies that got here out of {our relationships} and networks,” mentioned Chandra.
Avendus’ non-public fairness unit, whose portfolio contains Delhivery, Lenskart, Licious, VerSe Innovation, Xpressbees, and the Nationwide Inventory Change, has additionally earned a popularity for delivering massive exits to its backers in a well timed method. LensKart and the Nationwide Inventory Change, for example, each delivered 4 instances the cash Avendus invested inside 4 years of investments.
“Our fund’s lifecycle is 5 to 6 years. An issue with the Indian startup ecosystem is that buyers have poured a number of capital [into it] however don’t see returns for a protracted time frame. We’re targeted on how will we get our a reimbursement,” Chandra mentioned.
Regardless of the rising pattern of tech startups in India going public, a phenomenon that was unusual simply 4 years in the past, buyers can not solely depend on IPOs for returns. Based on Chandra, Avendus has established relationships that allow the corporate to exit its positions by promoting stakes to late-stage buyers, equivalent to sovereign buyers, offering another avenue for producing returns other than IPOs.
