Venture capital firm Ventureast has achieved the first close of about $85 million for its sixth fund, Ventureast Proactive Fund II (VPF2), a top company executive said.
The firm will raise another $65 million as part of the fund by end of March 2017, said Sarath Naru, managing partner of Ventureast. The firm has been on the road to raise funds for the past 18 months.
First close refers to the point when a fund can start investing from the money raised until then.
The new fund will be used to invest in seed and early-stage technology businesses, especially in finance and healthcare space. “Our investment strategy remains the same and our focus will continue to be on technology as a strong differentiator and not just an enabler,” said Naru. “We continue to invest in businesses where capital is not the primary competitive advantage.”
The sixth fund will be deployed over the course of next three years and the company is targeting to do 12-13 deals every year.
“The emphasis will be on relatively unaddressed sectors such as rural and semi-urban markets, needs of the SMEs (small and medium enterprises), and pure-play technology ‘picks and shovels’,” Naru added.
Ventureast expects funding opportunities to emerge in fintech, enterprise applications, cloud, mobile Internet and IoT(Internet of Things). It has already built a pipeline of early-stage businesses and will invest in three deals to start with. Between the three firms, Ventureast and other investors will co-invest close to $10 million, including $1.5 million in Bengaluru-based Find Me A Shoe, a virtual shoe-fitting room for e-commerce businesses, and $7 million in Mumbai-based OS Labs, a software provider for handset makers in India.
Ventureast did not disclose details of the third start-up, but said that it is a digital health firm that provides personalized on-demand healthcare via mobile devices, Internet and video calls, and is currently in stealth mode. Ventureast and its co-investors will invest about $2 million in this firm.
Ventureast has been investing since 1997 and manages a fund of over $400 million. The company has a portfolio of more than 100 investments in technology, healthcare and clean environment.
In January 2014, Ventureast’s portfolio company Little Eye Labs was sold to Facebook for an undisclosed amount. Little Eye is a tool that helps Android app developers measure, analyse and optimize their apps.
The firm is expecting two or three more exits in the next 12 months, Naru said without disclosing the names of the firms.
Ventureast’s other investments include Gland Pharma, a pharmaceuticals firm; Moschip, a semiconductor product company; and Sresta’s 24 Mantra, an organic farm-to-fork concept.