Accel launches $650M fund to fuel early-stage startups
The VC firm’s eighth India targeted fund aims to back companies in AI, consumer startups, fintech, and manufacturing.
Venture capital firm Accel has launched its eighth fund, earmarking $650 million to fund early-stage Indian and Southeast Asian startups.
CapTable had exclusively reported in September that the firm was in the market to raise its eighth fund.
The new fund saw participation from 131 undisclosed investors.
Accel aims to invest and back founders operating in enterprise AI and service-as-software (AI startups taking advantage of India's large IT services capabilities to provide automation offerings). It is also looking to invest in consumer companies, wealth management startups, and manufacturing companies, among others.
The corpus amount of the new fund remains the same as the VC’s previous fund, which was raised in early 2022.
Accel is a global VC firm that partners with startups across various stages. It has backed over 300 startups, including Facebook, Dropbox, Urban Company, and Flipkart.
Most recently, the firm tendered 10.5 million shares in an offer for sale in food delivery platform Swiggy’s IPO, realising a return of 3391% based on its acquisition cost of Rs 11.17 per share.
The new fund comes at a time when early-stage funding has lagged behind growth-stage and late-stage investments, as investors look to cash in on the IPO rush and startups with an established product-market fit. YourStory had previously reported this.
Additionally, with VC-backed companies representing less than 5% of India’s market capitalisation, the firm says strong public and private markets now provide founders opportunities to “build transformative businesses that shape the economic landscape.”
“India’s startup ecosystem is increasingly becoming the driving force behind the nation’s economic progress, with VC-backed companies surpassing $50 billion in public market capitalization. Indian founders have built resilient and enduring businesses which have been embraced by the public markets," said Shekhar Kirani, Partner at Accel.
"As India’s GDP and public market cap grow, we expect large outcomes from disruptive businesses led by bold and visionary founders. As always, Accel strives to be the first partner to these exceptional entrepreneurs,” he added.
(The copy was updated with an image of Accel India team and a quote from Accel.)
Edited by Swetha Kannan