India Quotient seeks $80m for Fund IV

The firm closed its previous vehicle on $60 million in November 2019, receiving commitments from RB Capital, Small Industries Development Bank of India (SIDBI), Flipkart co-founder Binny Bansal and Anicut Capital founder Ashvin Chadha, AVCJ Research's records show. India Quotient raised INR250 million ($3.4 million) for its debut fund in 2012 and then INR1.3 billion for Fund II in 2015.

"We are expanding our global investor base and will work with about 20 family offices in India. These business houses bring us credibility, access to markets and their world of wisdom and we give them access to investments that were hitherto available only to overseas money," Madhukar Sinha, a founding partner at the firm, said in a statement.

India Quotient aims to back 35-40 nascent start-ups across software-as-a-service (SaaS), social media, direct-to-consumer, education technology, and financial technology. Anand Lunia, the firm's other founding partner, added there is a willingness to "back founders when nobody understands them" and participate in multiple rounds. Qualification criteria include "the capability to take on large incumbents and want to build companies that go on to IP0."

Lunia, formerly a partner at Seedfund, and Sinha, who previously made microfinance investments at Aavishkar Group, established India Quotient in 2011. The firm has funded nearly 70 start-ups over the past eight years, of which 80% have gone on to raise follow-on rounds.

Last September, ShareChat, a social networking platform that focuses on Indian vernacular languages, raised $40 million in a pre-Series E round. This followed a $100 million Series D led by Twitter and Trustbridge Partners. Fintech player Lendingkart has also reached the Series D stage, having secured INR2.1 billion from Fullerton Financial Holdings and Bertelsmann India Investment, among others, in 2019.

India Quotient's website lists a dozen exits: five were consumer internet businesses, with three apiece in fintech and social networks and marketplaces.

Venture capital fundraising reached $1.9 billion in India last year, up from $1.85 billion in 2019. There were significant final closes for Elevation Capital – formerly SAIF India – Lightspeed India Partners, and Falcon Edge Capital. Since the start of 2021, both Endiya Partners and Fireside Ventures have closed their second funds, raising $75 million and $118 million, respectively.

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• Topics
• South Asia
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• India Quotient
• TMT