Peak XV announces rolling Anchor Fund to back new asset classes, funds
At its investor meet in Delhi on Tuesday, Peak XV announced its perpetual capital vehicle, Peak XV Anchor Fund, with an aim to become the largest LP in its new funds, and back new asset classes and venture capital funds.
Peak XV Partners has announced a new permanent capital vehicle called Peak XV Anchor Fund, with an aim to become the largest backer of its new venture capital funds. The new vehicle will also invest in new asset classes including publicly listed entities, and partner with new businesses and fund managers across regions.
The vehicle will pool in capital from partners and leaders from , starting as a small fund and compounding over time.
The announcement was made as part of a letter sent out to nearly 100 limited partners (LPs) in Peak XV who were attending the global investor meet in Delhi on Tuesday. The vehicle will start taking in commitments from April 1, 2024.
Formerly known as Sequoia Capital India and South East Asia, Peak XV Partners was formed after its parent entity Sequoia Capital split into three in June 2023. The fund had raised $2.85 billion as part of a new fund in 2022 and continues to deploy from it in India and South East Asia.
According to the letter, the new vehicle will not impact LPs who have invested in the main fund, according to the information shared with the LPs. The objective of the perpetual fund will be to create greater accountability and alignment with LPs. Anchor Fund will also promote greater skin in the game and bind the team together for the long term, according to a person in the know of the development.
Permanent capital vehicles (PCV) are common practice in the private equity sector when certain funds want to go beyond a lock-in. They do not draw down on their principal at any point in time. Recently, the Securities and Exchange Board of India (SEBI) has been deliberating on allowing PCVs in India to encourage long-term investors such as pension funds.
The announcement makes Peak XV the first venture capital firm to launch a perpetual fund from its internal balance sheet. Anchor Fund is also likely to be helmed by an independent leadership team.
(The copy was updated to correct a typo.)
Edited by Kanishk Singh