Have billionaire startup dream? Get one of these Venture Capital Firms to back your business idea and you’ll most probably taste success.
India has a budding startup ecosystem with thousands of fledgling business ideas. As per stats, 90 percent of startups in India fail in the first five years. In the competitive and unforgiving ecosystem of the day, it is crucial to carefully devise all your steps, which also includes who’s signed cheque you root for.
It is crucial to carefully devise all your steps, which also includes who’s signed cheque you root for.
Funding is on the rise in the Indian startup ecosystem. However, most funding is backed by a few as VCs are always on the look out for what’s different and has long-term potential. A recent study ‘Entrepreneurial India’ observed that 77 percent of VCs find a lack of unique business models.
However, if you think you have the uniqueness these investors are looking for, it’s a sunny future ahead. The Indian startup ecosystem received total investment of $3.42 Bn across 174 deals in Q1 2019. This counts for 5.36% growth Q-o-Q from $3.24 Bn in Q4 2018 and 39% Y-o-Y from $2.46 Bn in Q1 2018.
A recent study ‘Entrepreneurial India’ observed that 77 percent of VCs find a lack of unique business models.
But success in raising funds is never a guarantee that your dreams will reach eventuality. Raising equity is easy, but raising it from someone with an eye for potential, expertise in mentorship, and resource to back you up goes a long way in ensuring a brighter future for your business model.
So, if you think your idea has the right ingredients to make it big, target raising a cheque signed by one of these investors, and your fledgling idea is not just sure to get wings but will have a much higher chances of taking flight.
The firm’s Accel India Venture Capital fund which was incepted in 2009 has global interests in unicorns like Flipkart, Freshworks and Swiggy. The firm is evolving its expertise of partners to expand focus on early-stage tech startups.
Accel partners have 9 key members Mahendran Balachandran, Anand Daniel, Shekhar Kirani, Subrata Mitra, Prashanth Prakash, Dinesh Katiyar and Abhinav Chaturvedi, Prayank Swaroop and Barath Shankar Subramanian.
As per Prashanth Prakash to ET, “The next 10 years, our thesis of going early will still hold true which takes this kind of bandwidth and because these are early-stage companies we do need to spend time.” The fund does multiple small-cheque investments as part of its strategy with 70% of its investments from the $450 Mn fund for India ranging around $2 million.
Accel Partners’ strategy is multiple small-cheque investments with 70% of its investments from the $450 Mn India fund in the $2 million range.
Accel Partners’ expertise sectors are consumer internet, enterprise software, financial technology, business-to-business and healthcare where the major chunk of its investments happen. It started its India journey by acquiring Erasmic Venture Fund. Major feathers in the Accel hat include BookMyShow, BlackBuck, BlueStone, Flipkart, FreshDesk, Portea, Power2SME, Swiggy, and UrbanClap
Sequoia Capital India Advisors
Perhaps the most popular VC firm in the country, Sequoia has backed successful startups that have now become unicorns like BYJU’s, OYO, Zomato, Ola, Practo, among others. It has recently launched a new seed fund apart from its thriving portfolio.
Sequoia is a true Midas in the business. In August 2018, it closed its sixth fund at a corpus of $695 Million. The firm is focused on early and growth stage startups in technology, consumer and healthcare segments. The firm has backed over 200 companies in India and South East Asia.
The biggest names in the Sequoia basket are Zilingo, Bira, Mu Sigma, Freshworks, Druva, Freecharge, Pine Labs, and JustDial among others. Sequoia is constantly evolving, adding new expertise to extend its range of investments in Indian startup landscape.
Sequoia Capital is adding new expertise to extend its range of investments and has launched a startup accelerator and incubation program called Surge.
Sequoia launched a startup accelerator and incubation program called Surge which plans to mentor 10–20 early stage startups every six months and back them with $1.5 Mn early stage capital. The Venture Capital firm is expected to infuse over $100 Mn in startup investments in the next 4 years under the program. Sequoia’s keen investor eyes also include Shailesh Lakhani, Abheek Anand and former Google India Chief Rajan Anandan who recently joined Sequoia as India MD.
The powerful VC firm backs startups in different phases of journey, from seed stage to public listing. And they intend to back their founders throughout the success journey. SAIF Partners has a $350 million fund and its strategy is to acquire a substantial minority stake in seed stage firms and then keep backing them when needed.
Its strategy has worked out well with explosive tech startups like Swiggy which it backed in 2015. SAIF partners has backed the $3 billion rated foot tech firm on five different occasions. Its other successful seed investments include ShareChat, Meesho, UrbanClap, Paytm, MakeMyTrip and Just Dial.
As per Managing Director Alok Goel, “Our seed strategy is an integral part of the entire fund. We don’t want to have a separate seed fund and back several companies in the same space. We want to be with a founder for the entire journey, which can take 10 years or more.”
SAIF Partners’ strategy is to acquire a substantial minority stake in seed stage firms and then keep backing the startups for at least a period of 10 years.
In 2018, the Venture Capital firm backed 10 early stage companies including Finwego and Sensehawk. SAIF Partners is now looking to rack up its seed investments $2 million infusion in atleast 8-10 seed companies in the next year. As per investment analysts, ‘SAIF Partners investment decision-making is often independent of market sentiment.
Founded in 2006, IDG Ventures rebranded itself in 2018. As per the VC firm, the name change ‘signifies its focus on staying agile and sharp, like a ‘Chiratae’, or leopard, in the everchanging startup ecosystem’.
The firm was founded by Sudhir Sethi and T.C. Meenakshisundaram. With total assets under advisory numbering at $470 million, Chiratae Ventures has invested in 76 startups so far. The big names it has backed so far are Flipkart, Myntra, FirstCry, XpressBees, Newgen, Lenskart, Manthan, NestAway, PolicyBazaar, Cure.fit and Yatra.
As per Founder and Chairman Sudhir Sethi said, “Our passion is to back Indian entrepreneurs repeatedly, and grow with world-class entrepreneurs in India. The last decade saw a growth of 10X, the coming decade will see 20X in entrepreneurial activity in India.”
40 percent of the funds raised by Chiratae Ventures are rupee capital from domestic investors, proving the firm’s deep-rooted connect and expertise in India.
40 percent of the funds raised by Chiratae Ventures is in rupee capital from domestic investors, which proves the Venture Capital firm’s deep-rooted connect and expertise in India. Apart from domestic investments, the company has a strong footprint in the US, Middle East, and South East Asia with interests in HealthifyMe, Unbxd in US, CloudCherry in Middle East.
The VC firm focuses on a multi-stage investment strategy. Founded in 2006 by Avnish Bajaj and Rishi Navani, it evolved over the years into a VC firm targeting tech startups from a quasi-private equity investor. The firm started with initial corpus of $150 million with a top up of $300 million.
In 2011, Matrix Partners raised $300 million for a second fund and topped it up with $110 million in 2016, before co-founder Navani exited to incept a new investment firm Epiq Capital. The firm is currently led by Avnish Bajaj, Tarun Davda and Vikram Vaidyanathan.
Matrix has recently raised $300 million from 43 investors for its third fund to back startups across seed, early stage, Series A and B across sectors. Matrix Partners’ venture fund backers include leading university endowments, financial institutions, and foundations across Europe, North America and the Middle East.
Matrix Partners’ venture fund investors includes leading university endowments, financial institutions, and foundations across Europe, North America and the Middle East.
The Venture Capital firm has interests in over 60 companies including ANI Technologies (Ola parent), Mswipe, Practo; Limeroad, &ME, Vogo Automotive, Elemential, Dailyhunt, Mswipe, Five Star Business Finance, Treebo, Stanza Living, Ziploan, and DailyNinja.
By: Chitresh Sehgal, Senior Editor, Dkoding Media