Joining the ranks of global VC/PE firms raising India-focused funds, Lightspeed VP, a prominent name in the global early-stage/growth-stage startup investment space, has announced a new $275 million India fund. This is the firm’s third such fund for India. Lightspeed is known for backing the likes of Oyo and Byju’s, both of which are unicorns and provided Lightspeed with healthy returns.
The confirmation comes post an earlier report in July, that cited regulatory filings to confirm that Lightspeed has raised its third India focused fund. Regarding backers of the fund, Illinois Municipal Retirement Fund (IMRF) was proposing to be a large investor. The pension fund had invested in Lightspeed’s previous India fund as well.
Typically, Lightspeed’s first cheques to companies are in the range of $1-$3 million. Of course, the amount depends on the existing market dynamics and size of the company.
Lightspeed is the latest global PE/VC firm to have announced a fresh India focused fund. Earlier this year, Sequoia announced a massive $1.35 Billion fund for India and SE Asia market, with primary focus on India. Such lure to the Indian market is partly driven by the booming digital tech industry that India has presented, even though it is nascent compared with other matured markets.
Reliance-owned Jio, which raised a record $22 billion, that too during the COVID-19 pandemic, has helped draw major attention to India’s digital frontier.
That being said, Bejul Somaia, Partner, Lightspeed Venture Partners told ET that global Limited Partners (LPs), or sponsors in funds, still view India as a discretionary asset class. “LPs are still inclined to be selective… that said, there is a broad belief in the digital opportunity in India,” he said, commenting on the overall fundraising process.