According to recent reports, Unicorn India Ventures, an early-stage investment firm is selling its stake in six startups to a US-based investor for Rs. 50 crores, thus doubling returns for its limited partners (LPs).
The companies also include cybersecurity firm Sequretek, robotics startup Genrobotics, digital business publication Inc42, customer experience analytics start-up Clootrack, digital media startup inntot as well as healthcare startup NeuroEquilibrium.
These are known to be the investments from the firm’s first tranche of funds of Rs 100 crores, raised back in 2016 and deployed across 17 early-stage startups. Unicorn India Ventures partner Bhaskar Majumdar said in an interview that the firm had to write off its investments in three companies out of the 17 startups.
Moreover, the firm is said to have exited two companies, eCommerce personalization startup Boxx.ai back in 2019 as well as supply chain startup pharamarack in 2021. According to a report by the economic times, Majumdar said the VC firm would stay invested in two of its most successful companies from Fund I, including fintech firms Open and Smartcoin, while the rest of the exits from the first fund are still being figured out. Majumdar declined to disclose the name of the US-based investor but said it was a Delaware-based fund “run by some of the most successful tech entrepreneurs in the US.”
“Our broad thesis is that we go in very early,” said Majumdar. “We position ourselves as the first institutional investor. Typically, we sign small cheques of Rs 2-3 crore, and only 20% of the fund will be used to create a portfolio and the rest of it is for backing the winners in the portfolio,” he said.
In addition to this, the firm said that its second fund in 2020 with a corpus of Rs. 300 crores, with which it is said to have created a portfolio of 18 startups. “In the first fund, even before reaching the end of the life cycle, we have already returned the full capital to the investors,” Majumdar said. “Within the next few days, we will be returning almost another full return to the investors. Before the completion of the seventh year, we would have returned 2x back to the investors and, most importantly, the assets we still have is worth another 5x.”
Lastly, funding for early-stage startups dipped marginally to 839 million dollars in the April-June period, from 856 million dollars in the previous quarter, but as a matter of fact, it continues to be 30 percent higher than the total funding for the segment in the last quarter of 2021, as per Venture Intelligence.
This is despite the overall funding in Indian startups having dipped by 37 percent, probably in the second quarter of this year to 6.9 billion dollars.
Reading so far, I hope you must have gotten a fair insight into Unicorn India Ventures exiting from six startups by selling its stakes to a US-based fund, and by now I believe you will be able to decide on your own whether or not you think it was the right thing to do and whether or not you think will be their next move.
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