3one4 Capital Garners INR 1,000 Crore from Local and Foreign Institutional Investors

3one4 Capital, an early-stage investor, has garnered INR 1,000 crore from local and foreign institutional investors for its third flagship fund. The fund surpassed its goal of INR 750 crore due to considerable investor interest as the Indian startup environment grows more appealing.

In 2020, the venture capital firm began raising its third flagship fund. Since its start in 2016, it has raised five funds, including three flagship and two follow-on funds. It was founded by Pranav and Siddarth Pai, the founding partners of 3one4 Capital, and its portfolio companies include Licious, Loantap, Koo and Darwinbox.

CDC Group Plc, a UK sovereign development finance institution, the Japan-India Fund-of-Funds-Nippon India Digital Innovation AIF (NIDIA); South Korean video gaming giant KRAFTON, Inc; and prominent Indian endowments and foundations like Catamaran and Premji Invest are among the new investors in the third fund. A few significant domestic banks, as well as industrial, insurance, and financial services industries, have contributed to the fund.

Pranav Pai, a founding partner of 3one4 Capital, said, “this is a combination of performance and the efforts that we have taken on the governance front and obviously the macro environment has been positive. Our startups have become larger, we have had our first unicorn and we’ll have more unicorns next year. On the governance front, we are now the first approved UN PRI signatory from India”.

He added, “what has changed this year obviously is we have a record surge in liquidity, we have a record surge in VC investment in India and we have a record allocation of global pools of capital into the India strategy. All this has meant the Indian VC firms are now in demand”.

The investor's basic approach of building a portfolio of 25-30 early-stage firms for each fund will be continued in Fund III. It will invest in companies in the areas of SaaS and enterprise automation, finance, direct-to-consumer, digital media, and deep technology.