8i Ventures eyes to raises $50 million to invest in Commerce and Fintech startups

8i Ventures, based in Mumbai, is seeking to raise a $50 million second fund, Fund-II, which would be four times larger than its previous corpus, in order to increase its investments in commerce and fintech startups.

8i Ventures, which was founded in 2019 by entrepreneur and angel investor Vikram Chachra and Vishwanath V, has sponsored seven early-stage firms with its $13 million Fund-I.

Slice, a credit-card issuing business; M2P, a card-issuing platform; and Difenz, digital risk, and fraud monitoring provider, have all done well for the firm.

Slice, in fact, announced last week that it had raised $220 million in funding from Tiger Global and Insight Partners, among others, and that its valuation had surpassed $1 billion.

8i made its first investment in Slice earlier this year when the company was valued at $200 million, and it now has a 7.4X paper gain in less than six months.

Consumer brands such as Blue Tokai Coffee, an Indian supplement company, have also benefited from the firm's support.

According to Chachra, the fund aspires to deliver a return multiple that places 8i among the top 5-10% of all worldwide VC funds.

By the first quarter of next year, 8i hopes to have raised $25 million from existing and new Limited Partners (LPs), or investment fund sponsors, for Fund-II.

Fund I, which it obtained from notable angel investors and Indian family offices such as the DSP group, generated a 110 percent internal rate of return (IRR) and a three-fold return on invested capital.

The fund's majority of seed-stage investments, as well as follow-on investments in Series A and B rounds, are in the $1-$1.5 million range.

The VC expects cheque sizes to range from $1 million to $5 million with the new fund, depending on the companies' growth stage and maturity.

9Unicorns, a seed-stage fund in India, recently announced that it has closed its first accelerator for $40 million (about Rs 298 crore) in April.

It invests in a variety of sectors, including Deep Tech, B2B SaaS, media, FMCG, and fintech. Its founder, Vaibhav Domkundwar, raised $15.2 million in an early-stage fund last month, and Blume Ventures, one of India's largest early-stage funds, raised $105 million in its fourth fund's first close in November.

Others, such as Venture Highway, a tech-focused early-stage investment firm, raised $79 million (roughly Rs 560 crore) for its second fund last year, as funds increase their corpus to compete with larger players such as Sequoia Capital, Y Combinator, Accel, and other traditional VCs who want to catch startups at the seed stage to maximise returns.