With the goal of investing Rs 400 crore, GrowX Ventures, a business-to-business (B2B) and deeptech venture capital firm, established its Fund-II. The firm has previously sponsored firms such as Pixxel, Bellatrix Aerospace, CynLr, and Stashfin.
The fund, which formerly invested in early-stage companies, now intends to support 20–24 startups in both the early-stage and early-growth stages. In the seed rounds, the first check size will be up to Rs 10 crore, and in the Series B rounds, it will be between Rs 20 and 30 crore.
"We're constructing what we refer to as a stage-diversified portfolio with this specific fund. We've decided to concentrate on two phases." Ashish Taneja, the founder and CEO, stated, "We have been investing in the seed stage for the past 10 to 12 years, and we have seen significant success in this area."
Taneja claims that because the company kept a seed-stage mentality, it was unable to adequately support its champions.
"Series B represents a significant turning point for business-to-business deeptech firms. You can say that there is product-market fit at this point. The business has advanced to a point where the team and technology are in place, early client adoption is evident, and possible use cases are starting to emerge from the developed infrastructure. He emphasized the significance of remaining invested and assembling a portfolio of new endeavors at that particular point, saying, "This is where compounding happens."
The New Delhi-based company would concentrate its investments in B2B industries like semiconductors, advanced manufacturing, alternative materials, defense technology, and space technology. Opportunities in supply chain/logistics, healthtech, and finance will also be examined.
The fund's early growth stage will focus on entrepreneurs in a variety of industries, including deeptech, software-as-a-service (SaaS), and tech-enabled businesses. It will only concentrate on deeptech startups during the seed stage.
"The founders' knowledge of the market they want to disrupt is crucial during the seed stage," he stated.
GrowX is currently preparing to announce the Fund-II's first close, which is anticipated to occur around the middle of January. Taneja stated without providing specifics that the startup founders and both new and existing limited partners provided the majority of the funding.
The corpus of the previous fund, which was introduced in 2019, was Rs 162 crore. Taneja claims that all of the Fund-I capital has been used.
He stated, "We anticipate beginning to see exits from that specific fund in the middle of next year."
Before this, it had Fund-Zero, which invested in consumer, business-to-business, and deeptech sectors and was sector-agnostic. Since then, it has exited eight firms from this fund, including omnichannel retail platform Fynd and logistics optimization startup Locus.
