Venture capital firm Capital A has launched its second fund with a capital of Rs 400 crore, targeting startups in high-growth sectors such as manufacturing, climate, fintech and deep tech. The fund aims to identify innovative technologies and business models that promise to transform industries and drive sustainability, according to a statement from the firm.
Fund II will invest in 17-20 companies, offering initial investments of between $750,000 and $1 million, with total commitments of between $2 million and $3 million per company over their growth cycles. Capital A’s investor base for the new fund will be largely domestic, comprising family offices, high net worth individuals (HNIs) and industry leaders. Manjushree Ventures, a key backer of Capital A’s previous fund, is among the returning investors.
“Many high-potential sectors, especially manufacturing companies, are highly undervalued assets with great potential to scale quickly and become a significant contributor in the startup ecosystem,” said Ankit Kedia, founder and lead investor at Capital A. “Other areas of interest include sectors such as climate, deep tech and fintech, which remain the focus of our previous fund.”
The launch of Fund II comes at a time when India’s climate tech investment landscape is becoming more mainstream. Since 2020, over 475 investors have participated in climate tech funding, with more than half going live in 2023. Last year saw a 25 per cent increase in climate investors, with 124 funds making their first investments in the sector. While overall funding growth has remained subdued, the rise in investor participation highlights a growing commitment to climate solutions, the press release said.
Launched in 2021, the early-stage investor’s first fund saw success with startups like Chargeup, Bambrew, Jiraaf, BharatSure, and Entuple.
The second fund aims to contribute to the advancement of technologies that address critical global challenges while generating long-term returns for investors, according to the press release. The firm aims to close Fund II by the end of 2025.
First published: September 20, 2024 | 17:05 IS
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