B Capital Group, the venture capital firm started by Facebook co-founder Eduardo Saverin and Silicon Valley Indian-origin investor Raj Ganguly, has raised $143.6 million (about Rs 965 crore) that it plans to invest in India and Southeast Asia.
This is the first close of the VC fund, according to B Capital's filings with the US Securities and Exchange Commission.
The fundraise comes a couple of months after Saverin in February made his first direct investment in India when he backed Hit The Mark Inc., which runs Mumbai-based curated baby and kids products flash sales site Hopscotch.in.
B Capital joins other US-based VC firms such as Sequoia Capital and Nexus Venture Partners to invest in India. The move to focus on India comes at a time when the Indian startup ecosystem is in the midst of a constrained funding scenario.
The firm, which has offices in San Francisco, Los Angeles and Singapore, backs "brash entrepreneurs building the next generation of groundbreaking technology companies," according to Saverin's Linkedln account.
A joint blog post by Saverin and Ganguly said that India faced many gaps when it came to funding availability, stage, talent, institutions or exits. It added that the presence of such gaps in the ecosystem made it both equally challenging and rewarding for investors.
India represents a vast market potential and the Indian economy is projected to grow faster than the US economy, the blog post said, highlighting the opportunities in the South Asian nation.
The duo said that business models including the C2C (consumer to consumer), flash sales and online retail had entered a more advanced phase. Higher valuations of e-commerce firms, multiple funding rounds and emergence of Unicorns--or firms with a valuation of $1 billion and higher--such as Flipkart, Ola, Snapdeal and Shopclues were part of a larger trend emerging in Asian markets.
"The rapid rise and adoption of e-commerce means existing infrastructure and processes will require an upgrade," the post said.
It also said technologies that power business processes such as Big Data, artificial intelligence, robotics, blockchain, and augmented reality or virtual reality will also undergo an innovation across the value chain in India and will not just be concentrated around e-commerce.
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