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Lightspeed India Partners raised USD 275 million for its third India fund

Lightspeed India Partners made partial exits of nearly USD 900 million last year from its two star portfolio firms, Oyo and Byju’s.

Image by Nattanan Kanchanaprat from Pixabay

Venture capital firm Lightspeed India Partners Advisors on Tuesday said it has raised USD 275 million for its third fund to back early and growth-stage technology companies in the country across consumer and enterprise segments.

The new fund, Lightspeed India Partners III, will focus on startups that have a strong base of operations in India and are targeting domestic or global markets.

“This year began with a crisis like no other. It is always tough to start a company, it requires passion & leadership – and in these times, it requires more courage than ever before,” the company said in a statement. “Lightspeed believes this is when the best entrepreneurs and companies of the future will emerge.”

“Strong founders are utilizing the tailwinds of India’s digital ecosystem growth to build out a new future and Lightspeed is strongly committed to backing these founders,” it added.

A part of the Silicon Valley-based multi-stage VC investment firm Lightspeed Venture Partners, Lightspeed India has been investing in direct and cross-border Indian companies since 2007. In 2015, Lightspeed raised its first India-dedicated fund of USD 135 million. Three years later, the VC firm closed its second fund of USD 175 million.

So far, the VC firm has invested over USD 750 million in Indian startups. More than 80% of its investments have been committed to firms in Seed or Series A stages.

“Lightspeed will continue to focus on early stages of innovation, and work with founders to support them through their growth lifecycle – including the growth capital pool of over USD 3 billion raised recently in its global funds,” the VC firm said.

Globally, Lightspeed Venture Partners and its affiliates currently manage more than USD 10 billion, with investment professionals and advisors based in India, Silicon Valley, Israel, China, Southeast Asia, and Europe. Currently, the two-decades-old VC firm has an active portfolio of 400 startups. In April, Lightspeed Venture Partners raised three new global funds totaling USD 4.2 billion.

In India, the company has a portfolio of 24 startups, according to its website, including hospitality giant Oyo, edtech decacorn Byju’s, and social media startup ShareChat, B2B platform Udaan, and healthcare SaaS firm Innovaccer.

While globally, Lightspeed Venture Partners has made 18 exits of over USD 1 billion, its Indian arm, Lightspeed India Partners made partial exits of nearly USD 900 million last year from its two star portfolio firms, Oyo and Byju’s.

The VC firm now seems to be sharpening its focus on Indian startups that are helping the small and medium businesses go digital.

“With the Indian digital opportunity accelerating, many more sectors in B2B and B2C categories are emerging where technology is enabling new businesses and models,” Lightspeed India said.

In fact, the ongoing healthcare pandemic has accelerated the digital transformation in the world’s second-most populous country across enterprises and SMEs. This has emerged as one of the key trends that global investors are betting on.

Lightspeed is not the only global VC that has closed its new fund for India. Last month, Menlo Park-based VC fund Sequoia Capital raised USD 1.35 billion for the firm’s new venture and growth funds to invest in India and Southeast Asia.