Early-stage investor Unicorn India Ventures has marked the first close of its third fund at ₹225 crore, further adding to the early-stage dry powder in the country.

The venture capital (VC) firm is targeting ₹1,000 crore in its final close, which is expected to happen by 2024, it said in a statement on September 5. The VC plans to invest across sectors like climate tech, agritech, spacetech, aerospace, and the semiconductor ecosystem.

Investment in start-ups

With this Fund, the VC firm aims to build a portfolio of 25 start-ups that are focussed on global SaaS and digital platforms, unicorn India’s expertise areas. The VC is looking to invest a first cheque of around $1-2 million and would then look to invest in the follow-on rounds, it said in a statement.

Unicorn India Ventures said it invests only 20 per cent of its total investible corpus to create the portfolio and then uses the balance to back the ‘winners’ in its portfolio.

From the sector’s perspective, it is looking at the newer sectors of climate tech, agritech, spacetech, and the semiconductor ecosystem.

Founded in 2016 by Bhaskar Majumdar and Anil Joshi, Unicorn India Ventures also hired industry veterans Bikram Mahajan and Kamlesh Ahuja to strengthen its leadership. Mahajan, who will be a Partner at Unicorn India Ventures, will focus on portfolio management and growth of the VC’s investee companies, while Ahuja has joined as VP (Fund Operations) to look after compliance and back-office administration for all the VC’s Funds.

It launched its first fund in 2016 with a corpus of ₹100 crore and invested in 17 companies, including the banking platform Open.

Unicorn India Ventures claimed an internal rate of return of 60 per cent on a year-on-year basis. The VC said that from its first fund, it returned more than 2X cash within the fund’s life, with assets worth 6X still under management.

Unicorn India Ventures launched its second fund with a corpus of ₹300 crore in 2020 and invested in 20 companies through it. The VC claimed that most of the start-ups within its portfolio are already profitable or have a clear path to breaking-even.

“We continue to identify innovative business models with faster scalability. The metrics for us are a clear path to profitability for the companies. Being the first institutional investors, before making any investment, we spend considerable time with the founders to understand their vision, team’s capabilities, growth plans, and leadership style. Our focus is to invest in companies that are enablers of India’s digitisation across sectors. We avoid high-cash-burn businesses like D2C, Consumer Internet, and content businesses,” said Bhaskar Majumdar, Managing Partner, Unicorn India Ventures.

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