Early-stage venture capital firm Fireside Ventures has closed their second fund — Fireside Fund II at Rs 863 crores (about $118 million) with backing from marquee investors which includes SIDBI’s Rs 10,000 crore Fund of Funds for Startups, Investment Corporation of Dubai, Nippon India Digital Innovation AIF, Bajaj Holdings and Investment, ITC, L’Oréal, Pidilite group, Premji Invest, and a US university endowment. The fund will invest in 15-20 customer startups when focusing on digital-initial brands. “We have a commitment of Rs 863 crore while we started with a target of Rs 750 crore and saw strong interest from different investors and now have formally closed the fund. We have over 100 investors in the fund and had announced the first close (of the second fund) around a year-and-a-half back and have invested in four companies. We are seeing over 100 investment opportunities every month,” Kanwaljit Singh, Founder & Managing Partner Fireside Ventures told reporters on Wednesday in a virtual meet.
The initial close of about Rs 440 crore ($60 million) of the second fund was announced in November 2019. Fable Street, SARVA Yoga, Gynoveda, and Slurrp Farm had been the 4 startups backed from the initial close. The VC firm had closed its initial fund in February 2018 with a corpus of Rs 340 crores from which it created 18 investments. The market place chance to back digital-initial customer brands, according to Fireside, includes more than 110 million on the web shoppers that are probably to triple by 2025 even as online penetration in rural India is anticipated to develop to 45 per cent by this year. The fund backs such digital-initial customer brands across meals and beverages, beauty & individual care, way of life, and residence items segments. So far, Fireside has invested in 22 startups which includes boat, Mamaearth, Vahdam Teas, Yoga Bar, Bombay Shaving Company, Pipa Bella, Kapiva Ayurveda, and more.
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The development comes on the back of elevated e-commerce market place penetration that is set to be worth $one hundred-120 billion in gross merchandise worth by 2025 when e-commerce shoppers are anticipated to be about 300-350, according to a Bain and Co. report final year. Indian e-commerce, till 2020, was 3.4 per cent of the retail sector with about one hundred million customers and about $30 billion in GMV. Importantly, startup funding in 2020 had declined 21.3 per from 2019 amid Covid effect as investors place $11.4 billion in the pandemic year, down from $14.5 billion in 2019, according to the information shared by Tracxn. The fall in the quantity of bargains was significantly less serious as startups saw 1,152 funding rounds in 2020 vis-à-vis 1,185 in 2019.