Blume Ventures generates 5x gross return from first fund

Blume Ventures, an early-stage venture capital fund, has earned a 5x gross return from its first fund, which was launched in 2011. The company expects it to realise a 6x return in 2024.

Blume Ventures said, in a statement, that Fund 1 was launched with an initial capital of Rs 98 crore, followed by Rs 24.5 crore as Fund 1A in 2013.

The first fund invested in over 70 startups between 2010 and 2015, which include the likes of GreyOrange, Zopper Exotel, and WebEngage. The fund, which will close its full lifecycle in 2023, is backed entirely by 80 domestic investors, including Technology Development Board and SIDBI.

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According to Blume Ventures, Fund 1 has already realised 4.6x (gross returns) of the invested capital and is expected to realise 5.4x by 2024 when it is fully closed. Fund IA is projected to realise 7.0x (gross returns) by 2024 and has already realised 5.8x.

“The strong performance of our Fund I, conceived and executed during the nascent stages of India's venture and startup ecosystem, stands as a testament to the resilience and innovation of Indian startups. It is crucial to acknowledge and celebrate these successes, not only as a milestone for Blume but as a clear indicator that dispels any misconceptions about the potential for exits and liquidity in the Indian market," said Blume Ventures Co-founder and Managing Partner Karthik Reddy.

According to the VC firm, 17 companies, which comprise around 20% of the portfolio, generated 98% of the fund’s gross returns. They are GreyOrange, Carbon Clean, Turtlemint, Cashify, Purplle, Zopper, BeaconStac, E2E Networks, Mettl, Exotel, IDfy, Intrcity (Railyatri), Taxi For Sure, Promptec, Zidial, WebEngage, and Infollion. It also noted that, within these winners, the top 3 made around 3x of the entire fund: GreyOrange, Carbon Clean, and Turtlemint.

The firm said that the loss ratio of this early vintage is close to 50% on the count of startups but significantly lower on the capital.

“We've always believed that while the returns of a VC fund are typically discussed amidst much secrecy, there's immense value in sharing these figures more broadly with the ecosystem. At Blume, we're committed to fostering a transparent discourse in the industry," Reddy noted.