Bengaluru-based early-stage venture capital (VC) firm 3one4 Capital has closed two new funds as it looks to entrench the firm’s early-stage focus as well as add growth momentum to its investment portfolios.
The two funds, Capital Continuum I and Capital Rising I, a USD 56 million (INR 400 crore) dedicated opportunity fund and a USD 6.5 million (INR 45 crore) fund for seed projects, respectively, mark the firm’s continuing focus on early-stage startups in a market where investments are increasingly skewing towards late-stage firms to avoid risks.
3one4 will use Continuum I to write cheques between USD 3 million and 5 million for its portfolios at growth-stage, specifically, B+ rounds. And Rising I, the seed fund, is earmarked for companies, at idea stage or seed-stage, seeking the very first rounds and pursuing markets that are of interest to the venture capital. The cheque sizes are between USD 100,000 and USD 500,000.
“We firmly believe that the Indian startup ecosystem has achieved critical mass and now supports the development of market-leading businesses at scale,” said Siddarth Pai, Managing Partner of 3one4 Capital.
3one4 has on-boarded some prominent LPs (limited partners) for Continuum I including US-based Emory Investment Management, Japanese trading giant Sojitz, Infosys’ co-founder and former chairman N R Narayana Murthy-backed Catamaran Ventures, and Indian conglomerate Kotak-owned Infina, among others.
The objective of Continuum I is “to develop a strategic and long-term partnership with top-tier institutional pools of capital globally and help improve access to high-quality growth capital for the portfolio companies,” the company said in a statement.
With Continuum I, Emory Investment Management, which oversees a USD 7 billion portfolio of global investments, has made its one of the largest allocations to an Indian VC. This is also the first VC investment made by the Sojitz Corporation in India. The Japanese corporation has partnered with Continuum I to explore deeper technological and business relationships with the portfolio companies.
“These new LPs will explore co-investment opportunities in rounds raised by the portfolio companies and will work closely with the founding teams to help deploy and scale their value propositions globally,” said Pranav Pai, managing partner of 3one4 Capital.
3one4 was founded by Stanford University alum and brothers, Pranav Pai and Siddarth Pai, in 2016. Since its inception, the VC firm has launched a new investment vehicle almost every year.
3one4, whose portfolio companies include online meat delivery platform Licious, P2P lending firm Faircent, and media company YourStory, among others, manages a combined corpus USD 110 million across its portfolio of over 50 early-stage investments. Its investment areas include enterprise intelligence and automation, media and content development, fintech, deep tech, and consumer internet tech.