India's Sixth Sense targets $200m for third fund
Sixth Sense, an Indian venture capital firm that invests in early-stage start-ups, has set a target of INR15 billion ($200 million) for its third fund.
The fund will include an INR6 billion greenshoe option if there is sufficient investor interest, Sixth Sense founder Nikhil Vora told VCCircle.
Vora, formerly the head of research at brokerage IDFC Securities, established Sixth Sense in 2014 to invest in consumer ventures neglected by technology-focused VCs, a thesis shared by Fireside Ventures and DSG Consumer Partners. Unlike DSG, however, Sixth Sense also invests in enterprise technology firms. Vora was an early investor in Indian payment services provider Paytm.
Sixth Sense's first two funds include an INR1.18 billion vehicle raised in 2014 and an INR5.15 billion vehicle that exceeded a target of INR3.5 billion in 2018. The firm has invested in 20 companies so far and achieved two exits, including listed oral care manufacturer JHS Svendgaard in 2017 and Weddingz, an online marketplace for wedding venues that was acquired by budget hotel marketplace Oyo the following year.
Last year, Sixth Sense said it expected to exit Smaaash Entertainment, a gaming and entertainment centre operator, via IPO in 2020. Apart from Smaash, the first fund’s most significant capital commitments include Veeba Foods, an indigenous condiments manufacturer, and LEAP India, a returnable packaging solution provider for the storage and movement of products across supply chains.
Anchor LPs included Small Industries Development Bank of India for the first fund and India’s Ministry of Commerce and Industry for the second. Sixth Sense also counts consumer companies, pharmaceutical companies, family offices, high net worth individuals and some of the firm’s partners among its investor base.
Vora said he expects the third fund to include a new set of LPs including foreign investors. “We are fully invested from the first fund. We may look to add three to four companies to our portfolio from the second fund,” Vora told VCCircle.
Other Indian fund managers looking to raise funds this year include India Alternatives, Unicorn India Ventures, Inflexor Ventures and JSW Ventures. Plans by several India-based GPs have been derailed by an eight-week nationwide shutdown imposed by the government due to the COVID-19 pandemic.
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