Alteria Capital has raised commitments worth Rs 1,325 crore ($178.7 million) as part of the first close of its second consecutive venture debt fund, overshooting the final target corpus of the fund.
The fund, which received approval from the Securities and Exchange Board of India, sought to raise a total of Rs 1,000 crore ($135.7 million), plus a greenshoe option for another Rs 750 crore.
The first close comes just four months after the Mumbai based firm hit the road to raise the fund.
Alteria Capital said in a statement that there has been strong interest from domestic investors to participate in this asset class, leading to oversubscription over a very short period of time.
“We are honored to have the confidence of our investors and be able to raise the fund in such a short period of time and that too, with the ongoing challenges of the global pandemic,” Alteria co-founder and managing partner Ajay Hattangdi said.
With the first close, the firm’s assets under management (AUM) now stand at Rs 2300 crore.
The new fund will seek to invest in startups across early and growth stages with cheque sizes up to Rs 150 crore. The fund will also allocate capital for structured debt products aimed at later stage companies with a differentiated risk profile, it said.
Vinod Murali, cofounder and managing partner, Alteria, said that the venture debt firm will continue to focus on umbrella sectors such as consumer, technology and healthcare.
Alteria Capital had launched its second venture debt fund in December last year. It had also roped in two executives from rival InnoVen Capital to strengthen its top deck at the time.
Alteria was founded in 2017 by Murali and Hattangdi, who were former top executives at InnoVen. Its debut fund had a target corpus to raise Rs 800 crore with a greenshoe option of another Rs 200 crore. It hit the final close at Rs 962 crore in 2019.
For its debut fund, investors such as the Azim Premji Foundation and Flipkart co-founder Binny Bansal had joined as limited partners. Private-sector lender IndusInd Bank, Small Industries Development Bank of India (SIDBI), several large domestic banks and family offices had also invested in the debut fund.
Alteria has made at least 25 investments so far in startups such as Dunzo, Lendingkart and Faasos parent Rebel Foods.
Earlier this year, it invested Rs 90 crore (about $12.3 million) in digital payments firm BharatPe in one of the largest venture debt cheques written for an Indian startup. This was part of BharatPe's larger debt round that also saw contribution from other major venture debt firms Trifecta Capital and InnoVen Capital.
Venture debt has become an integral part of a startup’s funding cycle in India over the past couple of years as it rarely involves stake dilution by founders and provides companies with more time to grow.
Last month, another major venture debt firm Trifecta Capital announced the final close of its second fund at Rs 1,025 crore (around $140 million), slightly higher than the target of Rs 1,000 crore that included a greenshoe option of Rs 250 crore. Earlier this week, Trifecta Capital also said it is planning to launch a late-stage equity venture fund with a target corpus of Rs 1,500 crore ($201.6 million).