Avendes, the top investment bank for venture deals in India, confirmed on Wednesday that it is looking to raise up to $350 million for its new private equity fund.
The new fund, called Future Leaders Fund III, will enable the Mumbai-headquartered firm to write big checks and maintain meaningful positions in startups, its managing partner Ritesh Chandra said in an interview with TechCrunch. . TechCrunch reported in early April that Avendus was planning to raise a new fund.
A regular reality in most growth stage deals in India, Avendus has established itself as the largest venture advisor for startups in the country. It served on more than 30 deals last year, including mergers and acquisitions, according to Venture Intelligence, a private market insight platform. The growing size of its private equity unit indicates the firm's ambitions to extend its tentacles deeper into the ecosystem and capitalize more on wins.
The firm's rise was aided by the fact that many of its leading global competitors, such as Goldman Sachs, Morgan Stanley, and JP Morgan, initially paid little attention to the Indian market, allowing Avendis to gain a foothold and build relationships. Got a chance. With the country's growing number of tech entrepreneurs.
Those relationships are also helping the firm's private equity unit gain access to some high-profile deals. Apart from lead-backer SoftBank, financial services startups Juspay and Zeta, for example, have only allowed Avendus on their cap table. “These are the businesses that have come out of our relationships and networks,” Chandra said.
Avendus' private equity unit, whose portfolio includes Delhivery, Lenskart, Licious, VerSe Innovation, Xpressbees, and the National Stock Exchange, has also earned a reputation for delivering big exits to its backers on time. LensKart and the National Stock Exchange, for example, both returned four times the amount of Avandus' investment within four years of investment.
“Our fund life cycle is five to six years. One of the problems with the Indian startup ecosystem is that investors have put in a lot of capital. [into it] But a long-term return is not in sight. We are focusing on how to get our money back,” said Chandra.
Despite the growing trend of tech startups going public in India, a trend that was unusual just four years ago, investors cannot rely solely on IPOs for returns. According to Chandra, Avendus has built relationships that enable the company to exit its position by selling stakes to late-stage investors, such as sovereign investors, providing an alternative route to generating returns other than IPOs. do