Venture capital firm Elevation Capital has now announced raising of $400Mn for a new fund — Elevation Holdings — aimed exclusively at late-stage investments in technology-driven consumer and financial services startups. The fund marks a shift in the firm’s investment strategy, targeting companies that have either achieved profitability or have a clear path to profitability within the next three years. Elevation Holdings has already deployed capital in its first deal, participating in a $170 million funding round for the used-car platform Spinny. It intends to do similar deals, wherein the company is close to an IPO and will remain invested post public listing as well, the firm told MoneyControl.
The new fund will write checks ranging from $20 million to $50 million and aims to invest in 10-15 companies, maintaining a highly curated portfolio. Elevation Capital’s co-managing partner, Mukul Arora, described the fund’s philosophy as providing “permanent capital,” allowing the firm to stay invested through a company’s IPO and beyond. This approach is intended to address a gap in the Indian startup ecosystem, where pre-IPO companies often face uncertainty due to short-term investor horizons and constrained late-stage capital.
India’s tech sector has seen a slowdown in late-stage fundraising over the past year, as global economic conditions and investor caution have constrained large capital flows. Global geopolitical challenges, specially arising from a strain in ties between the US and India, have also made things hard. Despite these headwinds, Elevation Capital views this environment as an opportunity to deploy patient capital into companies with proven models and scalable operations. The fund will focus on profitability and clear business fundamentals – a response to the market trend wherein investors are valuing sustainable growth over aggressive expansion with high cash burn.
Elevation Capital, founded in 2011 as SAIF Partners India, was initially focused on early-stage investments in tech and consumer startups, building a portfolio that includes Paytm, Swiggy, and Urban Company. Nine years down the line, SAIF Partners rebranded itself as Elevation Capital, and two years later, the VC firm announced Fund VIII in April 2022, with a corpus of $670 million, aimed at accelerating partnerships with category-defining early-stage companies in India.
this development is hardly surprising – as more consumers engage with online platforms for financial services, e-commerce, mobility, and other digital offerings, there is increasing demand for scalable and profitable business models capable of serving a growing middle class. Late-stage startups, particularly in fintech and consumer tech, are seeking investors who can provide both large funding tranches and operational guidance ahead of public market listings. Elevation Holdings is positioned to bridge the funding gap for these companies.
By emphasizing long-term investment and profitability, the fund challenges the prevailing model of short-term venture returns, encouraging startups to focus on sustainable business operations rather than rapid market share accumulation. This could lead to more disciplined capital usage, improved unit economics, and ultimately higher quality companies entering the public markets. The fund’s entry may also attract additional foreign capital into India’s tech sector, as international investors often follow established domestic players with a track record of successful exits and deep sector knowledge. This can, in turn, create a more liquid Indian capital market.
