Early-stage venture capital (VC) firm 8i ventures on Thursday said it is marking the first close of its second fund with a targeted corpus of $50 million, a top executive told VCCircle.
The VC firm expects to mark the final close by March 2023, which it is reserving majorly for institutional investors, co-founder Vikram Chachra said in an interaction.
The firm has raised $25 million in its first close, largely anchored by high networth individuals (HNIs) and family offices like Salgaocars and Kothari (DSP), who had also invested in the first fund. The early-stage VC firm had launched its second fund in December last year.
8i ventures, founded in 2019 by Chachra and Vishwanath V, has companies like fintech unicorn Slice, M2P Fintech, Blue Tokai in its portfolio.
Through the fund, 8i ventures will invest in business-to-business fintech entities and e-commerce enablers. It will sign average cheques of $1.5-2 million, mostly in early stages. However, this could go up to $10 million across subsequent rounds, the company said.
“We believe fintech is the single largest venture opportunity in India. Our key insight when we launched Fund I, was that consumer payments and commerce are a trillion-dollar opportunity. With Fund II, we have an added focus on B2B fintech and commerce - which we believe to be the next trillion-dollar market in India,” Chachra said.
The firm is looking to make about 15-20 investments with the current fund, about 5-6 every year. So far, it has closed one investment from this fund, and two more are in the pipeline.
“We are actively investing. We are not seeing competition in the deals that we do. We see this as a great environment for seed investing,” said Chachra.
The firm had launched its first fund in 2019, which had a total corpus of $15.5 million. It is up 270% with a 100% internal rate of return (IRR) in 3 years. It has already returned 27% of its capital back to investors.
“We wrote the first cheque into several outliers that at inception, were unobvious winners. That’s because we partnered with founders targeting under-served categories, ignored by incumbents/industry players. Collectively, our Fund I portfolio winners already process $18 billion of payments annually, while generating $100 million in gross profits, between them,” said Vishwanath V, general partner, 8i Ventures.
Earlier this year, the company had partially exited from M2P Solutions Pvt Ltd (M2P) with a 36x multiple over 2 years. It had made a seed investment in the company with its maiden fund.
