Trifecta Capital raises Rs 1,500 crores for its maiden equity fund

Venture debt firm Trifecta Capital on Monday said it has raised Rs 1,500 crore in its maiden equity fund, Trifecta Leader Fund-I. The announcement comes roughly two months after the company said it secured Rs 750 crore ($100 million) in the first round of Trifecta Venture Debt Fund- III.

The Fund was launched in May 2021 and announced its First Close in July 2021. The maiden fund also has a green shoe option of Rs 375 crore, which the investor could use soon, according to a release shared by Trifecta Capital.

“For Fund III, which will end up being Rs 1,500 crore, we would probably be done fundraising around Q1:CY2022,” Rahul Khanna, managing partner, told YourStory in December 2021.

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This fundraise comes at a time when the startup ecosystem enjoying a mega funding boom with many family offices and LPs considering the space as an asset class. Trifecta Capital, which entered India around 2014, usually used to back startups at the growth stages. But with record unicorns being formed and startups being able to file for an IPO has made venture debt firms take bets on early stages firms.

Trifecta Capital has backed the likes of Ankit Nagori-led Curefoods in September 2021, after the foodtech startup raised its Series A round, and Gurgaon-based Rivigo in 2015, according to data available on Crunchbase.

Early-stage founders, across sectors, have also been increasingly turning towards raising a combination of debt and equity in a bid to avoid dilution of their stake in the company.

Up until November 2021, startups across India raised $339 million in venture debt, across 45 deals, compared to $124 million invested in 2020, across the same number of deals, according to data from Venture Intelligence.

Naturally, venture debt firms, among other investors, are raising maiden funds in record time and also bigger in size.

Trifecta Capital's competitor Alteria Capital — which has backed startups including hyper-local delivery player Dunzo, recent unicorn Spinny and Ananth Narayanan-led Mensa Brands — closed their second fund of Rs 1,800 crore, which is the biggest in the ecosystem so far.

It took nearly two years for Trifecta Capital to fully close fund I, and 18 months for fund II, while the Rs 750 crore of first round of Trifecta Venture Debt fund-III was raised only in about 60 days, according to Rahul.