Synopsis
Mumbai-based 8i Ventures is looking to raise a $50-million Fund-II, almost four times larger than its previous corpus, as the seed-stage investor looks to double down on its investments across commerce and fintech.
ETtechMumbai: Mumbai-based 8i Ventures is looking to raise a $50-million Fund-II, almost four times larger than its previous corpus, as the seed-stage investor looks to double down on its investments across commerce and fintech.
Founded in 2019 by entrepreneur and angel investor Vikram Chachra along with Vishwanath V, 8i Ventures has backed seven early-stage startups from its maiden $13-million Fund-I.
The firm’s fintech bets like Slice, a credit-card issuing startup; M2P, a card-issuing platform; and Difenz, a digital risk and fraud management firm, have performed well. In fact, last week, Slice said it had
raised $220 million from Tiger Global and Insight Partners, among others, as its valuation topped $1 billion. 8i Ventures had first come into Slice earlier this year, when it was valued at $200 million and is sitting on a 7.4X paper gain clocked in less than six months of its investment.
The firm has also backed consumer brands like Blue Tokai Coffee and Bbetter, an Indian supplements brand.
“8i’s Fund-I is clocking a multiple of 4.2 times on the capital we have drawn down, and 5.6 times on the investments we have made from the fund, over the last two years,” Chachra told ET. “We raised our fund in 2020-21 and expect to return around 25% of the fund assets under management by the end of FY22. We should be able to return the entire fund by FY23.”
He said they expect to deliver a return multiple that will put 8i in the top 5-10% of all global VC funds. He said they expect to make the first close of $25 million for Fund-II by the first quarter of next year from existing and new limited partners (LPs), who are sponsors in an investment fund. 8i’s Fund I, which it raised from prominent angels and Indian family offices like the DSP group, delivered an internal rate of return of 110% and a return on invested capital of three times.
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Majority of the investments made by the fund is in the range of $1-$1.5 million in the seed stages, as well as through follow-on investments in Series A and B rounds.
With the new fund, the VC expects the cheque sizes to go up to $5 million, depending on the growth stage and maturity of the companies. “With the new fund, we will be able to seed and co-lead Series A while maintaining our pro-rata in winners… When you have a tiny fund you run out of money to maintain your ownership as a company progresses,” Chachra said.
Other seed-stage funds in India include 9Unicorns, which recently said that it closed its first accelerator at $40 million (about Rs 298 crore) in April this year. It invests in various sectors including deeptech, B2B SaaS, media, FMCG and fintech.
Others like Venture Highway, a tech-focused early-stage investment firm, raised about $79 million (about Rs 560 crore) for its second fund last year, as funds increase their corpus to compete with bigger players like Sequoia Capital, Y Combinator, Accel and other traditional VCs which now want to catch startups at the seed-stage to maximise on returns.
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SynopsisMumbai-based 8i Ventures is looking to raise a $50-million Fund-II, almost four times larger than its previous corpus, as the seed-stage investor looks to double down on its investments across commerce and fintech.ETtech(From left) 8i Ventures founding partner Vikram Chachra, general partner Vishwanath V. and operations partner Indranil Das.Mumbai: Mumbai-based 8i Ventures is looking to raise a $50-million Fund-II, almost four times larger than its previous corpus, as the seed-stage investor looks to double down on its investments across commerce and fintech. Founded in 2019 by entrepreneur and angel investor Vikram Chachra along with Vishwanath V, 8i Ventures has backed seven early-stage startups from its maiden $13-million Fund-I. The firm’s fintech bets like Slice, a credit-card issuing startup; M2P, a card-issuing platform; and Difenz, a digital risk and fraud management firm, have performed well. In fact, last week, Slice said it had raised $220 million from Tiger Global and Insight Partners, among others, as its valuation topped $1 billion. 8i Ventures had first come into Slice earlier this year, when it was valued at $200 million and is sitting on a 7.4X paper gain clocked in less than six months of its investment. The firm has also backed consumer brands like Blue Tokai Coffee and Bbetter, an Indian supplements brand. “8i’s Fund-I is clocking a multiple of 4.2 times on the capital we have drawn down, and 5.6 times on the investments we have made from the fund, over the last two years,” Chachra told ET. “We raised our fund in 2020-21 and expect to return around 25% of the fund assets under management by the end of FY22. We should be able to return the entire fund by FY23.” He said they expect to deliver a return multiple that will put 8i in the top 5-10% of all global VC funds. He said they expect to make the first close of $25 million for Fund-II by the first quarter of next year from existing and new limited partners (LPs), who are sponsors in an investment fund. 8i’s Fund I, which it raised from prominent angels and Indian family offices like the DSP group, delivered an internal rate of return of 110% and a return on invested capital of three times. STARTUP ROCKSTARS IN 2021Sign-in to see our list of the most promising startups of 2021 Majority of the investments made by the fund is in the range of $1-$1.5 million in the seed stages, as well as through follow-on investments in Series A and B rounds. With the new fund, the VC expects the cheque sizes to go up to $5 million, depending on the growth stage and maturity of the companies. “With the new fund, we will be able to seed and co-lead Series A while maintaining our pro-rata in winners… When you have a tiny fund you run out of money to maintain your ownership as a company progresses,” Chachra said. Other seed-stage funds in India include 9Unicorns, which recently said that it closed its first accelerator at $40 million (about Rs 298 crore) in April this year. It invests in various sectors including deeptech, B2B SaaS, media, FMCG and fintech. Others like Venture Highway, a tech-focused early-stage investment firm, raised about $79 million (about Rs 560 crore) for its second fund last year, as funds increase their corpus to compete with bigger players like Sequoia Capital, Y Combinator, Accel and other traditional VCs which now want to catch startups at the seed-stage to maximise on returns. Stay on top of technology and startup news that matters. Subscribe to our daily newsletter for the latest and must-read tech news, delivered straight to your inbox.ETPrime stories of the day