V3 Ventures has a corpus of €100 million (around Rs 900 crore) to invest across India, Europe and the US.
The firm’s cofounder and investment partner Arjun Vaidya told ET that roughly 30% of the corpus will be invested in India.
“We remain bullish on India in the long term and so this is only our first commitment of capital, which we aim to invest in roughly two years,” he added.
V3 Ventures’ backer Verlinvest has already invested in Indian companies such as Byju’s, Purplle.com, Sula Vineyards.
V3 Ventures was founded by Vaidya, who founded Ayurvedic D2C brand Dr Vaidya’s in 2016, and Lopo Champalimaud, who founded Europe-based digital beauty-booking platform Treatwell.
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In India, V3 Ventures has already invested in audio content platform Kuku FM, and digital healthcare app Eka Care.“In India V3 will focus on investing across the consumer landscape with a clear focus on consumer brands, consumer technology and platforms and enablers to commerce,” Vaidya said, adding that the investment firm will have three focus areas while investing in early-stage startups. These include backing the right founders, the market size to determine the right point of entry for the business to scale, and core metrics such as bottom line, customer acquisition cost, etc, he said.
Vaidya will operate from Mumbai, and will lead investments in Asia and India alongside V3 Ventures partner Rahul Maheshwari, a statement said.
V3 Ventures’ India operations have been launched at a time when startups in the country, as well as those based overseas, have been going through a slowdown in venture capital funding in the backdrop of central banks across the world tightening monetary policies and raising interest rates.
Vaidya pointed out while businesses are still getting funded, deals are taking more time to conclude.
“Good companies and strong businesses are still getting funded. This is the case across business cycles. While it’s taking a little bit more time, deals are happening. I am fundamentally bullish on India and in this macro climate, it seems like we have a lot going for our economy. So, I remain bullish about deal activity for fundamentally sound businesses,” he said.
ET reported on March 21 citing a report published by the Boston Consulting Group (BCG), Times Bridge and TiE Delhi-NCR, that funding slowdown in India, which is paired with a large amount of unallocated dry powder, could lead to investors taking a “wait-and-see” approach on late-stage startups.
The report said that India-focussed funds were sitting on the highest-ever unallocated capital at $23 billion in 2022. The dry powder will continue to be mostly deployed at early-stage startups in 2023 with investors exhibiting patience with “growth and late-stage startups” with the focus being on profitability metrics, it added.
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