Kae Capital, an early-stage VC firm, has closed its Fund III at Rs 767 crore. Old Mutual Wealth, Velo Partners, and Finext are some of the international institutional investors who have backed this fund, while HDFC Holdings and SIDBI are from India.
This fund is backed by several startup founders, including Rajesh Yabaji (Blackbuck), Ashish Hemrajani (BookMyShow), Nitish Mittersain (Nazara), Srikanth Velamakanni (Fractal Analytics), Deep Kalra (MakeMyTrip), and Jitendra Gupta (Jupiter), among others.
Kae is targeting to invest in 25 companies through this fund and will look at sectors like B2B commerce, Consumer tech, SaaS, Fintech, and D2C, the fund said in a release.
Kae Capital has invested in 79 startups and claims a portfolio enterprise valuation of $8.52 billion. To date, the investor has made 14 exits.
The family offices of Infosys’ Gopalakrishnan, Allcargo’s chairman Shashi Kiran Shetty, Hero Enterprise’s Sunil Kant Munjal, Hemendra Kothari of DSP Investment Managers, and Apax India head Shashank Singh as well as SRF Family Office and Taparia Family Office also backed the fund.
The third fund, which was oversubscribed, will primarily invest in fintech, SaaS (software-as-a-service), consumer tech, B2B (business-to-business) commerce, health-tech, direct-to-consumer (B2C) brands and gaming startups, Kae Capital founder Sasha Mirchandani said in an interview.
Kae Capital
Kae Capital was founded in 2012 by Mirchandani, who is one of India’s earliest startup investors and is also founder of the Mumbai Angels network of angel investors. Winners of Kae Capital’s first fund of $25 million are online pharmacy 1mg and omnichannel shopping startup Fynd. From the second fund, it invested in Zetwerk. “We’re at 5x net returns in first and second funds,” said Mirchandani when asked how the first two funds have performed so far.
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“The DPI (distributed to paid-in capital) for Fund II is around 80% and we will hit 1x DPI for Fund 1 by March 2023,” he added.
The strategy helped it save funds to invest in 2022 and 2023 when valuations have become modest. Mirchandani also pointed out that investors are now getting more time for due diligence.
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