World Bank's IFC backs Alteria Capital’s short-term venture debt fund

The International Finance Corporation (IFC) has joined Alteria Capital as an anchor investor in its Shorter Duration Scheme (SDS), marking the World Bank unit’s first foray into India’s niche venture debt market.

The move aims to address urgent liquidity needs of high-growth startups in sectors such as fintech, electric vehicles, and consumer brands.

The SDS fund, distinct from its core venture debt offerings, will target short-term capital demands, including working capital and inventory financing, with licensed fintech firms and consumer-focused startups as primary beneficiaries. Portfolio companies under SDS include proptech firm Ivy Homes, financial services startup Swara Fincare, and consumer brand TEN x YOU.

“We funded $200 million of debt to Indian startups in 2024 alone, but there’s a meaningful gap in short-term financing options, especially for financial services and consumer companies,” said Vinod Murali, Co-founder and Managing Partner at Alteria Capital. “These companies need bespoke offerings from trusted partners—that’s the space we’re filling with SDS. We’re pleased to welcome IFC as an anchor investor.”

The fund plans to deploy capital over three years, targeting sustainable business models in underserved segments.

Alteria, one of India’s largest venture debt managers with Rs 4,500 crore in assets, has already deployed over $800 million in debt financing to startups since its inception seven years ago.

“Innovative financial solutions are crucial for bridging funding gaps,” said Wendy Werner, IFC’s Country Head for India and Maldives. “Our partnership with Alteria underscores our commitment to pioneering fund managers who drive business model innovation. By addressing short-term needs, we aim to accelerate India’s tech ecosystem and economic growth.”

In January end, Trifecta Capital announced the first close of its fourth venture debt fund, with a proposed size of Rs 2,000 crore.

The venture debt firm raised funding from insurance companies, family offices, and corporate treasuries, according to a statement. The amount raised was not disclosed. Founded in 2015, Trifecta Capital has to date raised Rs 5,300 crore across four venture debt funds and one growth equity fund. It has invested Rs 7,800 crore and has a portfolio valued at $67 billion.