India's A91 reaches $550m final close on Fund II
A91 Partners has closed its second India-focused fund with $550 million in commitments, nearly two-and-a-half years after raising $351 million for its debut vehicle.
The firm was established by Gautam Mago, Abhay Pandey, and V.T. Bharadwaj, who previously worked together at Sequoia Capital India. It makes early to mid-stage investments across the consumer, financial services, healthcare, and technology sectors.
The expectation was that half of Fund I would go into Series B and C rounds for established companies, while the rest would be deployed with founders who have not previously received – or even sought – institutional funding. Deal sourcing techniques in this area include cold-calling bootstrapped businesses.
Portfolio companies include Sugar Cosmetics, financial technology players Aye Finance and Digit Insurance, B9 Beverages, spice maker Pushp, and La Renon Healthcare.
Fund I closed in four months in 2019, buoyed by early commitments from a group of Indian founders and family offices that contributed about 20% of the corpus. A91 subsequently reached out to more than 150 institutional LPs, narrowed the list to about 25, and ended up with 15 commitments.
Asia Alternatives and the International Finance Corporation (IFC) both participated in Fund I. IFC announced in September that it was considering an investment of up to $25 million in Fund II.
“We started A91 in 2018 with the following beliefs – the nature of entrepreneurship in India is changing, more new-age businesses will be created, and patient capital will play an important role in accelerating value creation,” Mago said in a statement.
“We also believed in the opportunity to create a world-class Indian investment firm – for founders who are aiming to build large enduring businesses from India, for either local or global markets. All these beliefs have been strengthened over the last three years.”
India private equity fundraising stands at $6.4 billion year-to-date, already exceeding the 12-month total of $5.6 billion for 2020. Once again, venture capital is the most popular strategy by dollar value, with approximately $2.2 billion committed to local managers.
Notable final closes include Stellaris Venture Partners raising $225 million for its second fund, Sequoia securing $195 million for its second India seed vehicle, and enterprise software specialist Avataar Ventures raising a $100 million top-up fund. In addition, venture debt players Trifecta Capital and Alteria Capital closed funds of $140 million and $241 million, respectively.
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