Global accelerator Upekkha launches $2.5M annual fund for SaaS startups
Global startup accelerator Upekkha announced the launch of a venture fund — UP Funds — which will invest in software-as-a-service (SaaS) startups with a rolling of $2.5 million every year.
The fund plans to support about 20 startups annually by investing $100,000 in each startup under its accelerator programme. The global accelerator's VC fund model is designed to increase optionalities for SaaS startup founders by allowing them to choose to return (invested) capital through their own recurring business profits by taking part in strategic exits, or by going public, the company statement read.
From the investors’ perspective, UP Funds is like a SIP (systematic investment plan) or EMI (equated monthly instalments) for venture capital investors (known as Limited Partners or LPs). These LPs have to invest a minimum of $10,000 per quarter to start with, and can also change the amount every quarter. This allows Upekkha to deploy capital faster than in a traditional funding model and at the same time, it offers investors the flexibility to contribute on a quarterly subscription model basis, instead of making a colossal investment upfront.
Commenting on the launch of the fund, Prasanna K, Managing Partner of Upekkha said, “Bootstrapping versus funding is a false dichotomy; SaaS startups need the right model of capital at the right time. While our accelerator is already helping founders build a revenue flywheel to earn more than a dollar of recurring profit from less than a dollar invested, UP Funds scales the flywheel with a pooled incremental fund that helps SaaS founders achieve freedom to choose their own success paths by building recurring profits with low capital investments.”
According to a report by NASSCOM, India currently houses more than 1,600 tech startups. Moreover, SaaS revenues crossed $1.5 billion last year, while deep-tech revenues have surged 65 percent in five years. India houses a number of SaaS startups and unicorns including Zoho, Druva, Clevertap etc.