8i Ventures exits M2P Fintech with 12x returns

Early-stage venture capital firm 8i Ventures has earned a 12x return on its investment in M2P Fintech in a span of four-odd years, marking a complete exit from the startup.

The VC firm had made an initial investment of Rs 9.7 crore in M2P Fintech in early 2020 and it realised a return of Rs 115.9 crore with an internal rate of return of 131%. The VC firm had a partial exit in April 2022.

Describing the investment as a stupendous success, 8i Ventures Founding Partner Vikram Chachra said, “We got an opportunity to return the capital to our investors and limited partners are getting more capital than what they invested.”

M2P Fintech had announced a fund raise of Rs 850 crore in the month of September which included both primary and secondary transactions.

“8i was the first venture capital fund to believe in M2P Fintech’s vision of creating a world-class BaaS infrastructure platform from India for the global market. They have supported us in every funding round, from seed through Series B. For us, they feel more like cofounders than investors,” said M2P Fintech CEO & Co-founder Madhusudanan R.

8i Ventures invested in M2P Fintech when the startup was valued at around $9 million, and now it is valued at around $600 million.

According to 8i Ventures, the investment in M2P Fintech has generated 1.27x the entire corpus of Fund I on a pre-tax basis, while utilising just 10% of its capital. Fund 1 was Rs 100 crore in size and the VC firm is in the process of raising a second fund of $50 million.

The Fund I of 8i Ventures is presently up 2.5x with an IRR of 37% and a multiple on Invested Capital (MOIC) of 3.3x. This fund has invested in around 12 startups which include companies such as Slice, Easebuzz, Blue Tokai, Bbetter, etc.

Chachra said, “We have many winners in our portfolio with some of them looking at a potential IPO in the next three to four years.”

He noted that among the top five winners in its portfolio, the revenue ranges between $9 million and $120 million.

The VC firm, which largely invests at the seed stage of funding, believes in identifying the broad trends in the digital economy and scout for startups that come up with differentiated solutions. 8i Ventures typically invests in the range of $300k to $1.3 million.

Chachra said they are very confident that the second fund will also perform well and will look at profitable exit whenever opportunity arises.