Artha India Ventures may soon float its own fund as early-stage investing has seen its size shrink significantly. The family company of former BSE director Ashok Damani is in the final stages of making a formal application to market regulator SEBI to register Artha Venture Fund.
The fund will invest in startups across seed, pre-series A and series-A levels of growth.
Artha Venture Fund, which will be registered as a Category I Alternate Investment Fund post the regulator's approval, will carry a size of Rs 200 crore with a greenshoe option of Rs 100 crore.
A bunch of Indian high networth individuals have promised to put in Rs 40 crore, reveals Ashok Damani, they are waiting for the regulators nod. They have taken the mantle of bridging the gap in early-stage funds at a time when angel and seed investments have seen a significant dip, both in volume and deal value terms.
According to a media report, in April that angel network platform Indian Angel Network (IAN) had floated its maiden fund with a corpus of Rs 350 crore and made the first close at Rs 175 crore. Seed investment platform Venture Catalysts too began expanding globally last month to strengthen its global investor team spirit and widen the pool of capital available for the early-stage pipeline.
With a fund life of seven years and the option to extend it by two years, Artha Venture Fund will look at ticket sizes that range from Rs1 crore toRs 7 crore across startups.
Artha India Ventures follows a self-sustaining method for funding startups. The cash flow generated from its clean energy asset in Rajasthan is used to fund startups’ growth. It talks about Rs 90 lakh per year and hence limits the group’s ability to write bigger cheques, which they aim to do through the new fund.
The fund will be promoted by Artha India Ventures and Singularity Holdings whose investment arm has invested in lingerie brand Clovia and fashion e-commerce portal StalkBuyLove.