3one4 Capital announces final close of two new dedicated seed and opportunity funds

3one4 Capital has raised Rs 445 crore with the Continuum I and Rising I funds, and aims to enhance its deep involvement model and work more closely with founding teams to scale their current advantages and capture market leadership.

3one4 Capital has announced the closure of their two new funds, 3one4 Capital Continuum I, a dedicated opportunity fund with a corpus of Rs 400 crore, and 3one4 Capital Rising I, a dedicated seed fund of Rs 45 crore. Both these funds are extension strategies of 3one4 Capital's core focus in early-stage tech.

Continuum currently stands oversubscribed and has confirmed Rs 400 crore in commitments towards its  final close. Continuum I will focus on investing into a curated selection of opportunities from the 3one4 Capital portfolio and will aim to invest in the growth stages of these companies.

The team at 3one4 Capital

The fund's objective 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 across 3one4 Capital's funds.

Continuum I will focus on Series B+ rounds of companies from the 3one4 Capital portfolio with cheque sizes between $3 million and $5 million. It has several new LPs to the 3one4 Capital family, with several larger LPs in earlier funds continuing their support.

The new LPs are top-tier institutions, including Emory Investment Management, a large US endowment that manages the assets of Emory University, Emory Healthcare, and The Carter Center, Sojitz, Catamaran, Infina (a private investment company owned by the Kotak family), and several top-tier Indian institutions and family offices.

Emory Investment Management oversees a $7 billion portfolio of global investments and is a significant investor in Continuum I. This marks one of their largest allocations to an Indian venture capital firm.

Sojitz Corporation, a leading global conglomerate from Japan, has announced its investment in 'Continuum I' together with launch of a new office in Bengaluru, India.

This is the first venture capital investment made by the Sojitz Corporation in India. Sojitz will partner with Continuum I to explore deeper technological and business relationships with the portfolio companies, and use its wide-ranging global network and broad knowledge base to enhance value creation via strategic alignment.

Focusing on institutional rigour

3one4 Capital Rising I, a 2018 vehicle, had targeted Rs 25 crore and completed its first close in December 2018. The fund currently stands oversubscribed and has confirmed Rs 45 crore in commitments towards its final close. Rising I is a dedicated seed fund that will focus on investing in the very first rounds of companies pursuing markets where 3one4 has developed core sets of thesis.

The fund is purpose-built to provide founding teams with institutional rigour as they build out from Day One. Rising I will enter idea-stage and seed-stage companies with cheque sizes between Rs 50 lakh and Rs 3.5 crore.

Pranav Pai (left) and Siddarth Pai (right).

Siddarth Pai, Managing Partner of 3one4 Capital, says, “At 3one4, we firmly believe that the Indian startup ecosystem has achieved critical mass and now supports the development of market-leading businesses at scale. These companies combine deep domain expertise, sustainable competitive advantages, and uncompromising customer experiences to build a gravity well around themselves.”

“Our deep involvement model has helped our companies optimise for defensibility and growth in revenue and scale. With Continuum, we will mesh these learnings into a solid reference framework for our companies entering the growth stage of their journeys."

The inflection points at which truly game-changing technologies need capital infusions and have moved earlier into the funding spectrum. This paradigm shift has demanded that funds look at early-stage investing with a new lens, and that investors bring more to the table than bulk capital.

Accelerating flywheels of growth

With drill-down frameworks for product development, market segmentation, financial planning, tech roadmap management, and corporate development, Rising I will aim to help accelerate the flywheels of growth within seed-stage tech startups.

Rising I’s investors include existing supporters of 3one4 Capital’s earlier funds and new family offices who have been working with the firm as co-investors in the seed stage. It serves as a collaborative institutional anchor to several super angel groups looking to formalise their seed strategies as the early stage matures in India.

Pranav Pai, Managing Partner of 3one4 Capital, says, "We are grateful to be working with a stellar set of Limited Partners (LPs). With large strategic and financial institutional investors entering the funds, we continue to have an excellent and intellectually-diverse set of minds that bring unparalleled advantages to the firm and its portfolio companies.

"The investors span multiple geographies and have synergetic interests in 3one4 Capital and its portfolio. 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," Pranav says.

(Edited by Teja Lele Desai)


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