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Rainmatter to invest Rs 1,000 Cr in Indian startups: Nithin Kamath

Rainmatter's investment will offer patient capital without exit obligations, aiding long-term resilience.

Rainmatter to invest Rs 1,000 Cr in Indian startups: Nithin Kamath

Thursday August 10, 2023 , 2 min Read

Rainmatter Capital, Zerodha's investment and philanthropy arm, will be investing Rs 1,000 crore in Indian startups, its CEO Nithin Kamath said on Thursday.

Since 2016, the fund has invested approximately Rs 400 crore into 80 startups, Kamath said in a post on X (formerly Twitter). "We realised that having patient Indian investors backing Indian founders is helpful."

"Good businesses cannot be built overnight, something we learned in our journey. So we are perennial investors and stick with the founders for as long as it takes the founders to build a sustainable business," he added.

All the upside generated through the investment will be put back into the fund to support other entrepreneurs. "We are now increasing our commitment by increasing the allocation by an additional Rs 1,000 crore in a perennial structure or with the ability to stay invested forever," Kamath said in a blog post on Zerodha.

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As per Kamath, using patient capital—where an investor invests in a company with no expectation of a quick profit—combined with no exit obligations, founders can stand to benefit in a country like India where it can take much longer to build resilient and sustainable businesses.

He illustrated this with the example of Zerodha. "From 2010, it took us almost 7 years to catch our first big break...So, we believe that the longer a business can survive and grow slowly and steadily, the higher its chances of getting lucky. Of course, there are numerous other variables and this may not work in all contexts, especially in highly mature industries."

Rainmatter Capital is an initiative founded by Zerodha founders Nithin and Nikhil Kamath. Over the years the overall scope of the fund grew and it now supports people solving problems in the field of fintech, health, climate change, and storytelling.

Pee Safe, CRED, and AgniKul Cosmos are some of the notable startups which have received backing from Rainmatter, as per its website.


Edited by Akanksha Sarma