India Quotient Sees Greater Interest from Global Investors for $130-mn Fund, Its Largest Ever
Investors Eye Massive Opportunities in Indian Startups
Bengaluru: In a significant development, venture capital firm India Quotient is set to raise its largest fund to date, with a staggering $130 million in commitments. The outstanding response from global investors is a testament to the growing confidence in India’s startup ecosystem.
Global Investors Flock to India Quotient’s Latest Fund
In an exclusive interview, India Quotient’s founding partner, Anand Lunia, revealed that nearly 80% of the commitments are expected to come from global investors. This marks a significant shift from their previous funds, where most of the capital was raised from domestic investors.
Indian Investors Seek Quicker Exits
Lunia attributed this change to the growing preference among Indian investors for quicker exits, citing the country’s past experience with earlier funds. "Indian investors often want quicker exits because of their past experience with funds. When compared to the returns in the public markets, which were doing very well, there is also some pressure to match that," he said. "This is also because they are very early in this asset class. So, we are now going to flip it as we are also getting good interest from global investors."
Exits and Performance
India Quotient has partially exited some of its portfolio companies, including Vyapar, Sugar Cosmetics, and Giva, in recent times. The firm has returned approximately ₹600 crore against the ₹1,600 crore raised across all its four funds to date. In its first fund, India Quotient returned a 5.9x multiple. Its second fund has yielded 1.5x so far, with the potential to return almost 6x through secondaries in ShareChat and Sugar Cosmetics. The third fund has returned 35% of the capital raised.
Backed by High-Profile Investors
India Quotient’s previous backers include Gulf-based Indian billionaire BR Shetty, Flipkart co-founder Binny Bansal, RB Investments (the Singapore-based family office of Rajesh Bothra), MakeMyTrip’s Deep Kalra, and Paytm founder Vijay Shekhar Sharma.
Betting on Bharat
The new fund, India Quotient’s largest ever, is expected to close by mid-2023. The firm will continue to back early-stage companies that focus on solving problems outside the metros. India Quotient has been sector-agnostic in the past but plans to increase its focus on areas like edtech, consumer, software, and digital dopamine.
Solving Problems for the Masses
Lunia emphasized the firm’s preference for companies that don’t just cater to the urban class. "Within edtech, we are always scouting for companies that make products at a price point of ₹100-200. In India, there is so much scale if companies price their products appropriately," he said.
New Areas of Interest
India Quotient is also evaluating opportunities in quick commerce and verticals beyond groceries, such as gaming, betting, and astrology.
A Decade of Success
Founded in 2011 by Lunia and Madhukar Sinha, India Quotient has backed over 80 early-stage startups, including Lendingkart, Propelld, FabAlley, Citiflo, and PagarBook. With its latest fund, the firm is poised to continue playing a significant role in India’s startup ecosystem.
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