Mirae Asset Venture Opportunities Fund 1, with a corpus of $35 million (Rs 256 crore) and an option to take it up to $75 million, will cut cheques for seed and Series A financing rounds, as it eyes an early entry into fledgling tech companies locally.
The fund will operate independently as decision-making will lie with the Indian team helmed by Ashish Dave, who has also been overseeing the firm’s growth investments here through Mirae Asset-Naver Asia Growth Fund which has a corpus of more than $1 billion.
Mirae has been bullish on Indian technology with its global fund being active here over the past two years, having already deployed $200 million across Ola, BigBasket, Zomato and Shadowfax, among others.
South Korea and China are the only two other counties where Mirae operates a country-focussed early-stage fund.
For now, Mirae Asset Venture’s only limited partner or sponsor is Mirae Asset group.
The clampdown on Chinese capital into India has also bolstered the likes of Mirae to build a long-term plan for India tech investments.
While the newly launched India fund will invest in early-stage startups, the growth-stage bets would continue to be made through its global corpus. Anything beyond $10 million will be routed through Mirae’s global growth fund, said Dave, chief executive of Mirae Asset Venture Investments, while confirming the development.
“Our growth fund invests a minimum $10 million in assets due to which we missed out on a lot of early opportunities where companies wanted to raise smaller amounts. Further, since there is a global investment committee process, it takes some time to arrive at a decision. The India fund will give us flexibility to get in early in some of these deals as the decision-making is local and quick,” Dave told ET.
Early-stage deal activity in India has seen a lot of momentum over the past few years, with most venture funds wanting to get a bigger slice of startups right at the beginning so that they have significant ownerships at a lower valuation. Mirae Asset Venture will invest $1-5 million over the next 12-18 months in Indian fintech, consumer Internet, and software-as-a-service firms.
“Apart from leading rounds, we will work with some funds closely and co-invest alongside them. We also have our Korean partners who will be investing alongside us. Investment size will be around $2-4 million for seed to Series A opportunities,” he added.
Commenting on Mirae’s current India investments, Dave said: “Our portfolio companies have fared well and are adequately capitalised for next 2-3 years at least. In fact, companies like BigBasket, Shadowfax and Zomato have benefitted significantly due to the increased digital adoption.”
As for exits and IPOs in 2021 for India tech companies, Dave said there were at least 5-6 companies, which would go public paving the way for liquidity in the Indian market.
“These companies are becoming very efficient as digital adoption increases with less marketing efforts. This was the missing piece in the VC ecosystem and such IPOs will set a playbook for new entrepreneurs on how to create large sustainable businesses,” Dave said.