Blume Ventures raises Rs 200 crore in the first close of its new opportunity fund
Prior to this, Blume had raised a similar-sized opportunity fund in 2021. The VC firm said that the last fund brought out strong performers from Fund 1, and a majority of the portfolio’s underlying metrics have grown at 35 percent + CAGR (compound annual growth rate), resulting in follow-on rounds even in this market. Blume has also raised similar-sized Opportunity Funds in 2018, 2021 and 2022 to invest across startups such as Exotel, Grey Orange Robotics, Smallcase, slice, Unacademy and WebEngage.
Venture Capital firm Blume Ventures which has backed unicorns including Unacademy, Slice, Purplle, Spinny and Ola — has raised Rs 200 crore in the first close of its new opportunity fund, Fund 1Y.
Blume, through its third growth fund, is looking to raise Rs 400 crore for the remaining corpus. The three-fourths of the corpus would be used to buy assets held by its current funds, providing investors with an exit strategy, Blume said in a statement.
Fund 1Y has received backing from high-quality LP base, with existing LPs in Blume Ventures’ other funds participating again, the statement said, adding that it has visibility for the remaining corpus.
Blume Ventures said it will invest part of the capital from the new fund to include nine firms in the portfolio of the Rs 400 crore Blume Ventures opportunity fund. Of this, the VC will buy out four companies —Intracity, Cashify, Carbon Clean, and Zopper—from their legacy Fund I and allied investment vehicles and use the remaining to invest in the existing five winners of their other funds. The VC firm has already completed its investment from the fund in online beauty product retailer Purplle.
“We have a fabulous set of winners in our portfolio, and I am glad that we have been able to raise additional capital to stay invested longer and go deeper in our winners. We believe in the power of public markets and are confident that businesses such as Purplle, Zopper, Cashify and others in this portfolio are well entrenched on the path,” said Vikram Gawande, Vice President, of Growth Investments, Blume Ventures.
The first close of the new fund comes six months after Blume Ventures closed its fourth flagship and largest-ever fund of $250 million. It is looking to back around 30-35 startups from its fourth fund and has already made over a dozen investments.
“It’s a global practice for Fund Managers like Blume to provide exits to the existing LPs by finding new investors who can buy out a combination of assets from the original Fund. Blume is one of the first VCs in India to have executed this structure with the new investors also being onshore,” said Karthik Reddy, Co-founder and Partner, Blume Ventures.
Prior to this, Blume had raised a similar-sized opportunity fund in 2021. The VC firm said that the last fund brought out strong performers from Fund 1, and a majority of the portfolio’s underlying metrics have grown at 35 percent + CAGR (compound annual growth rate), resulting in follow-on rounds even in this market. Blume has also raised similar-sized Opportunity Funds in 2018, 2021 and 2022 to invest across startups such as Exotel, Grey Orange Robotics, Smallcase, slice, Unacademy and WebEngage.
Blume said through these continuity and opportunity funds, the VC buys out stakes of high-performing companies from its legacy funds at pre-validated price points discovered by follow-on investors and holds on to these positions as they brace up for a path to profitability and eventual public listing.
“The current environment and our unique strategy allows us to balance the interests of our current and incoming investors and hold the best of our companies for another 3-4 years before eventual public listing and create wealth for the local ecosystem. It's a win-win solution for all involved,” added Reddy.
The VC said it also invests additional capital into break-out businesses on the back of follow-on investors, thereby continuing to create effective ways for its LP base to participate in certain high-performing businesses.
Several investors have launched or closed funds this year to invest in Indian startups — B Capital closed its first healthcare-focused fund worth $500 million corpus, Avaana Capital marked the first close of its climate and sustainability fund at $70 million, Aeravti Ventures launched a Rs 100 crore fund to focus on early-stage startups in DeepTech, AgriTech, and Emerging Sectors and Capria Ventures marks first close of $100 million Global South Fund II.
First Published: Jun 22, 2023 12:58 PM IST
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
Stampede-like situation disrupts Rahul Gandhi, Akhilesh Yadav's joint rally in Uttar Pradesh
May 19, 2024 4:26 PM
Ladakh Lok Sabha election: With Independent candidate's entry, it's now a 3-way contest for BJP and Congress
May 19, 2024 4:01 PM