Jungle Ventures, which counts Indian startup unicorns such as Moglix and Livspace as its investee companies, has marked the final close of its fourth Southeast Asia and India focused venture capital (VC) fund at $600 million, higher than its initial target corpus of $350 million.
"India has been growing rapidly in terms of our dollar allocation. So roughly 50% or even more of the new fund could go into India," Amit Anand, founding partner, Jungle Ventures, told VCCircle in an interaction.
In a separate statement, Jungle Ventures said that the $600 million corpus comprises $450 million in the main fund and $150 million in additional managed commitments.
The latest fund-raising has brought Jungle Ventures’ total assets under management (AUM) to over $1 billion. The Singapore-based investor, founded by Anand and Anurag Srivastava, mobilised $10 million for its first fund in 2012. The VC firm then went on to raise $100 million for its second fund in 2016 and $240 million for its third fund in 2019.
Anand noted that Indian entrepreneurs have become more ambitious and no longer want to be the leaders in the domestic market but want to lead in Southeast Asia, Middle East and in some cases, globally as well.
"We were perhaps the first investors who told entrepreneurs that we will help you go global. In 2012, we invested in ZipDial and helped them go global. The company was later sold to Twitter. Today, if you look at some of our recent companies - Turtlemint, Leap, Moglix, Livspace, Vayana Network - we've helped all of these companies expand outside India," he explained.
Over 50% of the total commitments in the new fund have come from existing investors including Temasek, International Finance Corp (IFC), Dutch investor FMO, and German development finance institution DEG. "If I look at all our key existing LPs, each one of them have done between 100-200% reup in our new fund," noted Anand.
Jungle Ventures also took this opportunity to rope in new investors such as Japan's Mizuho Bank and global asset manager StepStone Group, said Anand, adding that most of the fund-raising happened virtually.
“50% of its LPs are family offices and the remaining half are institutions. In terms of geographical split between the LPs, it is almost one-third each between Asia, Europe and the US,” Anand said.
In terms of co-investments with its LPs, for every dollar Jungle Ventures has invested in its portfolio company, around $1.2-$1.3 has been invested by its LPs.
Anand underlined that while the fourth fund is larger, Jungle Ventures will continue to maintain a concentrated portfolio of 15-18 companies across India and Southeast Asia. This means that Jungle Ventures will reserve more capital for follow-on bets on its portfolio companies.
So far, for every $1 million Jungle Ventures has invested in its company, it has typically done a follow-on of $2-10 million. "If you look at Livspace and Moglix we have been their investors from the seed stage to the time they turned unicorns and we are still invested in them. With more firepower now, we can do more follow-on investments from the new fund," he said.
A unicorn is a privately-held startup with a valuation of at least $1 billion.
The fourth fund saw its initial close with a corpus of $225 million in September last year. Anand said that the VC firm has committed about 10% of the corpus so far. The investments from the new fund in India include Eveworld, a Web3 based social-crypto-community platform for women), inFeedo, an employee experience software-as-a-service (SaaS) platform and Atomberg, a direct-to-consumer (D2C) consumer electronics brand.
Anand explained that one of the larger new macro themes that Jungle Ventures is now starting is to put more capital behind is decentralisation.
"We are living in a very interesting time where decentralisation is making a more equitable internet and hence, we like that approach. So, concepts like social commerce or Web3 look interesting for the VC firm,” Anand said.
Web3 or Web 3.0 stands for a decentralised version of the Internet that runs on peer-to-peer technologies such as a public blockchain.
Jungle Ventures is also assessing edtech startups leveraging Web3 and has already made a bet on a startup in stealth mode.
"We have invested in an edtech company which is bringing the power of AI (artificial intelligence) and decentralisation to the next wave of teachers and mentors," he said without disclosing its identity.
He also said that the fund will selectively look to invest in startups in the food and climate spaces where it is seeing "interesting business models come up”.
In terms of exits, he said that Jungle Ventures has made a gross 40% internal rate of return (IRR) across all the funds via mergers and acquisitions (M&A) and secondary sales. He added that he expects exits via initial public offering (IPO) to happen in the coming years as its portfolio companies have reached scale.
