Early-stage venture capital (VC) firm Prime Venture Partners, which has backed companies like MyGate and Mfine, announced on Wednesday the first closing of its fourth fund at $ 75 million (or ₹ 556 crore).
Prime Venture Partner’s fourth fund is the largest to date, totaling $ 100 million, and has also seen established institutional investors such as the International Finance Corporation (IFC), part of the World Bank Group, join as a partner. limited.
IFC’s contribution to Prime Fund IV amounts to $ 15 million, which has also seen the involvement of a large endowment fund, the venture capital firm told Mint.
Prime had closed its first fund worth $ 8 million in 2012, its second fund worth $ 46 million in 2016, and closed its recent Fund III in 2018 worth $ 72 million.
With Fund IV, Prime expects to continue making four to six investments per year, and seeks to deplete the new fund over the course of the next three years. Overall, it appears to support 16-20 companies with the new fund.
In the past, the venture investor has largely backed startups with strong fintech and healthtech digitization themes. It will now seek to diversify its investment in new segments of decentralized technologies such as blockchain, electric vehicles, crypto, as well as games and entertainment.
It will continue to support larger software games in India, which are focused on international customers.
“IFC has a strong development focus, and most of the companies we have supported in the past have a strong development philosophy, whether we’re talking about NiYO bringing neo-banking to manual workers or MyGate, for example. They (IFC) also bring a wealth of best practices from around the world and credibility to the work we have done so far IFC […] invests alongside partners, especially in India, and it is a reasonable possibility for them to participate in some of the our rounds, “said Sanjay Swamy, managing partner at Prime Venture Partners.
Swamy added that the VC is expected to deplete its Fund III in the next 18 months as it seeks to participate in its portfolio monitoring rounds.
To date, Prime has backed about 32 companies in three funds, and will continue to bet on companies from the seed to the Series A stage.
Prime has been the first investor in startups such as the invoice discount platform, KredX; interactive learning platform, Quizizz, that have gone on to raise follow-up rounds of the likes of Tiger Global and Sequoia Capital India.
In recent months, several Indian venture capital firms have closed their new funds. Chiratae Ventures (formerly known as IDG Ventures) made its final close for its fourth and largest fund at $ 337 million earlier this month. Soon after, even Stellaris Venture Partners closed its second fund at $ 225 million this month.
“The market has many more players on the VENTURE CAPITAL side and that is dwarfed by the opportunities and high-quality entrepreneurs that the ecosystem is seeing. At Prime, we think it’s good that there is more money that motivates more entrepreneurs to get in. Certainly valuations have risen, but our ability to support the founders and work closely with them continues to keep us differentiated, “said Swamy.
Eight-year-old Prime Venture Partners is now looking to add a fourth partner to its fund as it looks to formally expand its partnership and add more operational experience to the team.
