Unicorn India Ventures is selling its stake in six startups to a US-based fund. The companies include technology, and healthcare startups
Unicorn India Ventures is selling its share in six firms to a US-based investor for Rs 50 crore. With this the early-stage investment has doubled returns for its limited partners (LPs).
Robotics company Genrobotics, cybersecurity firm Sequretek, customer experience analytics startup Clootrack, digital business newspaper Inc42, digital media startup Inntot, and healthcare startup NeuroEquilibrium are among the six firms involved.
These were investments from the firm’s first tranche of cash, which was raised in 2016 and distributed to 17 early-stage firms. The lifespan of this fund will conclude early next year.
In 2019, the business exited Boxx.ai, an ecommerce personalization startup, and Pharmarack, a pharmaceutical supply chain startup, in 2021. Majumdar stated that the VC company will remain involved in two of its most successful startups from Fund I, including fintech firms Open and Smartcoin, while the remainder of the first fund’s exits are still being determined.
Majumdar would not reveal the identity of the US-based investor, but did say it was a Delaware-based fund “managed by some of the most successful IT entrepreneurs in the US.”
“Our general assumption is that we go in extremely early,” Majumdar explained. “We want to be the first institutional investor.”
“Typically, we sign tiny cheques of Rs 2-3 crore, with only 20% of the capital used to establish a portfolio and the balance utilised to back the portfolio’s winners,” he explained.
With a corpus of Rs 300 crore, the firm launched its second fund in 2020, with which it has created a portfolio of 18 startups.
“In the first fund, we returned the full capital to the investors even before the end of the life cycle,” Majumdar said.
“Within the next few days, we will provide nearly another full return to investors. Before the end of the seventh year, we would have returned 2x to the investors, and the assets we still have are worth another 5x.”
The news comes at a time when exits for Indian startups are becoming more difficult, as global macroeconomic headwinds continue to affect newer fundraising opportunities. If market conditions remain unchanged, venture capital firms that have not raised new corpus will face increased pressure to deliver results in line with their fund cycle, EThad reported on July 28. Furthermore, despite the fact that venture capitalists are not in a rush to deploy funds, India’s early-stage startups have unprecedented dry powder waiting to be invested, with notable investors such as AccelNSE 2.40%, Elevation Capital, Sequoia’s accelerator programme Surge, Axilor, and Athera Venture Partners (previously Inventus Capital) raking in new funds.
While the funding slowdown has impacted late and growth stage investments, early-stage investments have remained largely unaffected by the downturn. According to Venture Intelligencehttps://timesapplaud.com/unicorn-india-ventures-sells-its-stake-in-6-startups-to-american-fund/, funding for early-stage startups fell slightly to $839 million in the April-June period, from $856 million the previous quarter, but it remains 30% higher than total funding for the segment in the fourth quarter of 2021.
This is despite the fact that overall funding for Indian startups fell 37% in the second quarter of this year to $6.9 billion.