Unicorn India Ventures announces first close of Fund III at Rs 225 Cr

Mumbai-based venture capital firm Unicorn India Ventures on Tuesday announced the first close of its Rs 1,000 crore Fund III. The first close has reached Rs 225 crore and the final close is expected by March 2024.

UIV plans to use the fund to build a portfolio of 25 startups that are focused on global SaaS and digital platforms. As for sectors, the fund will bet on climate tech, agritech, spacetech, and the semiconductor ecosystem, according to a press release.

The firm expects to invest $1-$2 million per startup initially and will then plan follow-on investments. As a part of its thesis, UIV says it invests only 20% of its investible corpus to create the portfolio and the rest to back the winners of the portfolio.

Started in 2016 by Majumdar and Anil Joshi, UIV is a technology-focused early-stage venture capital firm that invests in startups in emerging sectors. In 2020, UIV launched a Rs 300 Cr Fund II.

Fund II has a portfolio of 20 companies. Most of the startups within the current portfolios are already either profitable or have a strategy in place to break even soon, the venture capital firm said.

"The metrics for us are a clear path to profitability for the companies. Being the first institutional investors, before making any investment we spend considerable time with the founders to understand their vision, the team’s capabilities, growth plans, and leadership style,” said Bhaskar Majumdar, Managing Partner, Unicorn India Ventures. UIV avoids high cash-burn businesses such as D2C, content, and consumer internet startups.

Joshi said that while the firm has invested in startups from Delhi, Mumbai, and Bengaluru, about 60% of its portfolio is "built from startups coming from emerging regional hubs like Kochi, Jaipur, Ahmedabad, Pune, and Hyderabad."

"Unicorn is perhaps the only fund that has worked tirelessly with state governments in Kerala, Odisha, and Madhya Pradesh to roll out startup policy with an aim to find high potential startups from Tier II and III," he added.

The firm has also announced senior hiring for Fund III. Bikram Mahajan joins the team as a Partner and Kamlesh Ahuja will take charge as VP (Fund Operations).