India's Together seeks $150m for second VC fund
India’s Together Fund, an early-stage VC firm focused on artificial intelligence (AI) and software-as-a-service (SaaS), has reached a first close of undisclosed size on its second fund. The target is $150m.
LPs are said to include institutional investors from US and Asia. The firm raised at least USD 85m for Fund I in 2021.
Much of the strategy behind Fund II is pinned on the proliferation of generative artificial intelligence (AI), which Together sees as increasingly indispensable to business in general and a turning point in SaaS business modelling and operations in particular.
Together expects every SaaS company will be transformed by AI, saying that it looks forward to “riding the gen AI wave.” It claims to have invested in three generative AI companies in healthcare, developer infrastructure, and marketing in the past three months.
“Over the last few months, we have witnessed first-hand the spectacular rise of gen AI and the consequent Cambrian explosion in AI-first companies. The new world will create breakthrough opportunities for start-ups to build AI-native solutions, form factors, business models, and even entirely new software categories,” Together said in a statement.
“The pace of change is exponential and entire markets could be created and captured by early pioneers in a matter of weeks, if not months.”
Together was set up in 2021 by Eka Software founder Manav Garg, Freshworks co-founder Girish Mathrubootham, and Shubham Gupta, previously of Matrix Partners India. It claims to be the first and only VC firm in India led by start-up founders.
The GP claims differentiation in its high engagement, empathy, and rapport with founders, as well as access to SaaS developer tools and resources. Portfolio support work is said to cover strategy, hiring, customer introductions, and follow-on financings.
Together also organises initiatives such as regular AI mixer events to facilitate discussion among industry stakeholders, as well as a WhatsApp group for AI enthusiasts. It claims that portfolio companies benefit from access to a network of 200 AI exports called the Zone.
Fund II will extend the strategy of its predecessor with a focus on seed and series A investments and cheque sizes ranging from USD 1m to USD 5m. However, this will come with an enhanced focus on generative AI in SaaS and enterprise software themes, including developer tools, open-source software, cloud-native infrastructure, and application programming interfaces (APIs).
Deal targeting will encompass first-time founders and extend into tier-two cities. Together has engaged with more than 1,700 start-ups to date and invested in 20. Many companies are based across both the US and India.
Six investees have received follow-on funding. They include data privacy compliance provider Privado (backed by Insight Partners and Peak XV Partners), accounting software player Spendflo (Accel and Prosus Ventures), and sales data platform Toplyne (Tiger Global Management and Peak XV).
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