India’s startup ecosystem has evolved rapidly over the past few years. Sheer number of unicorns and the sheer amount of capital that has flown in, is a testament to that. In 2021, there was $39B deployed into Indian startups and 11 tech IPOs. Half of India’s 88 homegrown unicorns were minted in the last year alone. And with founders getting capital and generating their own personal wealth, a bunch of them have also turned angel investors, in an attempt to give back to the ecosystem and to also get a taste of investing on their own.
AngelList’s Utsav Somani, a prominent angel investor himself, has looked at this trend as a potential opportunity to generate greater value for investors, and has hence launched a unique new fund, termed ‘Galaxy’. A $45 million fund, that is backed by the likes of Silicon Valley investors Naval Ravikant and Tim Ferris, Galaxy hands over selected founders a $1Mn fund, to further invest in potential early-stage startups they are mentoring or themselves investing in.
And if they make great investments, they’re eligible for a second fund of $2M. Galaxy’s limited partners include the likes of Naval Ravikant from AngelList, Elad Gil from Color Genomics and Tim Ferriss.
The structure of the fund is quite unique. While founders get money to invest, they are mentored and guided by seasoned angel investors on selecting the right companies. “There’s no pressure to invest. Founders stay focused on their companies and invest at their own pace. They just invest in the companies they’re helping anyway”, added Somani in a blog post.
Talking about the rationale behind starting such a fund, the blog post further adds, “Founders want to raise from other founders because the best startup advice comes from other founders. With their own funds, founders in India can also provide the best capital to get early-stage startups off the ground”.
Galaxy’s mentors include Utsav Somani, Naval Ravikant, Tim Ferriss, Elad Gil, Jeff Fagnan, Jake Zeller, Lachy Groom and Jonathan Swanson. AngelList provides legal and back-office services for the Galaxy funds.