DSG closes India, Southeast Asia consumer fund at $50m

DSG reached its target of $40 million in April, with half the contributions coming from Fund I investors – primarily high net worth individuals – and half from four institutional players. They are Verlinvest, which represents the families behind AB InBev; Mousse Partners; UK-based multi-family office ACPI Investment; and the Chanrai family, which founded Olam International. Strong demand led to the fund staying open to accommodate additional LPs.

Fund I closed at $24 million in 2012. Of the 21 investments made through the vehicle, there have been four full or partial exits – Oyo Rooms, Zipdial, Veeba Foods, and Redmart – that have together realized more than the entire fund size. Half the proceeds have been returned to investors and the rest redeployed in the portfolio. Of the Fund II corpus, half is earmarked for follow-ons and the rest for new seed and Series A deals.

“The idea is to go early, often greenfield, writing the business plan with founders and putting in enough capital to develop a product or service and do a pilot launch. If it works, we put in more money and hopefully continue working with the company as it builds. The thesis is to go in with a 10-year horizon,” Deepak Shahdadpuri, DSG’s founder and managing director, previously told AVCJ.

Shahdadpuri established his track record at GEM India Advisors, where he became the first institutional shareholder in Sula Wines. The company has since established itself as India’s biggest winemaker. Everstone led Sula’s Series B round and was then taken out by Verlinvest – one of its LPs – in the Series D. Verlinvest also bought some shares from GEM India.

The DSG-Everstone alliance is driven in part by necessity. DSG’s strategy involves writing small checks from small funds and Everstone helps minimize operating costs by handling back office requirements.

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• Topics
• South Asia
• Southeast Asia
• Fundraising
• Growth
• Consumer
• DSG Partners Asia
• India
• Verlinvest
• Everstone Capital