IvyCap to invest Rs. 600 crore or double in Startup Ventures


There’s always a silver lining! True to this statement, IvyCap Ventures are IvyCap_Logo_Squareagain ready to shed about INR 600 Crore or more in it’s second fund, “IvyCap Trust Fund II”. This again comes in the situation when fundraising ecosystem is being too harsh. Firm is looking to double the amount owing to the support from institutional backers and the promising growth of the backed companies said managing partner IvyCap Ventures, Vikram Gupta.

Gupta said, “We have the option of not stopping at Rs 600 crore. We areVikram seeing a lot of interest from investors based in Hong Kong, Singapore, Japan and from the US. A lot of our portfolio companies are growing at a tremendous pace, and there is a need for follow-on funding. Therefore, we decided to have a green shoe option of another Rs 600 crore”.

Already about Rs. 450 Crore has been promised through hard and soft commitments, remaining Rs. 150 Crore to be raised in upcoming 3-4 months. Firm declared first close of Fund II at Rs 300 crore in April 2016. Though names weren’t disclosed, it is said negotiations are being held between fund and a number of global fund-of-funds, sovereign wealth funds, family offices and corporates that are looking to enter Asia’s third-largest economy.

We know that IvyCap ventures is a early-mid stage investment firm sponsored by IIT Alumni trust along with number of banks and insurance companies among its Limited Partners. IvyCap has already taken two steps from Fund II through investing in home services startup TaskBob and fin-tech venture FTCash. Fund I backed about 10 ventures, digital advertising technology company Sokrati, online jewellery company Bluestone online lingerie retailer Clovia and others.

Gupta added firm will opt to use 10% of the new fund capital to back very early-stage startups that will be sourced from IvyCamp,  its Bengaluru-based seed-stage platform to register startups. There are three sorts of investments- seed-stage investments, follow-on rounds for their existing companies and fresh investments. The firm is planning to expand by backing about 35-40 early-stage ventures and making 15 new investments.

“There are quite few investors fishing around for investment opportunities in India, and who have approached us. We’ve started our pre-marketing efforts, and expect to raise another $100 million in 8-10 months, ” he said.

Now in India VC fundraising roadway is experiencing a lot of bumps. Though early players such as Sequoia Capital and Accel Partners (active since the initial stages of the sector in 2006-07) have easily raised capital for their new funds due to their better track record while others have faced strong challenges.

Data gathered by VCCEdge tells India is facing exit in risk fundingcapital, a globally leading index for LPs which is now ducked to a 15-quarter low in value terms. Elaborating the statement it says, “Deal values are dropped by 70% to $508 million for the first three months of 2016, compared to $1.7 billion in the year-ago period. Transaction volume also plunged by more than half, to 39 deals, compared to 89, compared to the year-ago period”. With the stats not in favour and lots of emerging ideas, the sector seems to be in danger but it feels like such investments will keep it breathing through these ups and downs.