3one4 hits first close on third India VC fund
India’s 3one4 Capital has reached a first close on its third flagship early-stage venture capital fund.
About $40 million has been raised to date, according to a release. The target is $100 million.
LPs include family offices, endowments, foundations, corporates, and financial institutional investors. The fund is expected to bring 3one4’s assets under management to around $210 million.
It follows a final close last year of INR4 billion ($54.4 million) on a top-up vehicle known as Continuum that has now hit the INR8 billion mark with support from Japan’s Sojitz Corporation. This coincided with a final close of INR450 million for a seed fund called Rising I, exceeding a target of INR250 million.
3one4’s raised INR2.5 billion for its second flagship fund in 2018, beating a target of INR1.5 billion. LPs included India’s Reliance Venture Asset Management. The firm's debut vehicle closed at INR1 billion in 2016. Corporate networking has been a priority in both fundraising and operational activities.
“Our corporate investors – Indian and from overseas – help us validate our views on the technical and product aspects of new ideas,” Pranav Pai, co-founder of 3one4, told AVCJ. “They are also valuable in serving as pilot customers and go to market partners for the relevant companies from our portfolio.”
Fund III will follow a similar strategy to its predecessors, writing checks of up to $4 million for 25-30 Indian start-ups across themes including software-as-a-service, enterprise automation, direct-to-consumer, media, financial technology, and machine-driven intelligent services. Broader sectors of interest include healthcare, education, food, mobility, logistics, and agriculture. Indic language apps will also be targeted.
Previous investments include human resources software company Darwinbox, fintech supplier Open, and Bugworks, a pharmaceuticals researcher focused on microorganisms known as superbugs. One of the firm’s most advanced companies is fresh meat and seafood ordering platform Licious, which raised a $25 million Series D round in late 2018.
“The current paradigm shift has demanded the acceleration of disruptive business models and a rebalancing of the early-stage investment lens. With this new fund, 3one4 Capital is purpose-built to be deeply involved across the lifecycle of the next innovation engines from India,” Siddarth Pai, co-founder of 3one4, said in a statement. “Our deep involvement model is designed to help founders optimize for sustainable growth by serving as a force multiplier on the path towards defensible long-term value creation.”
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