Lightspeed India Partners announced that it has closed US$ 275M from LPs for its third fund to invest in India.
The latest fund is Lightspeed’s biggest for India and will enable Lightspeed India Partners to make early-stage bets on more than two dozen start-ups in the region. The firm has six partners in the region. It closed its first dedicated fund for India at US$ 135M in 2015. The second fund closed at US$ 175M in 2018. The venture firm has invested more than US$ 750M to date.
Investments by Lightspeed
Some of the firm’s major investments include Udaan– a business-to-business marketplace valued at more than US$ 2.75B last year, ShareChat– a local social media platform ShareChat in advanced stages of discussions to raise capital at more than US$ 1B valuation, and SaaS startups like DarwinBox, Yellow Messenger and OkCredit.
In the past year, the firm has made two high-profile partial exits in the past year from budget-lodging start-up Oyo and edtech giant Byju’s that combined had cash returns of more than US$ 900M.
The Indian arm of the firm typically invests at early stages of a start-up. It works with its global mothership for writing bigger checks to support some portfolio start-ups at later phases. In India, more than 80% of the firm’s investments have been at the seed or Series A stage.
Earlier this year, Lightspeed closed a US$ 4B fund globally. Additionally, Lightspeed has a big presence in China. In 2019, its China arm announced a US$ 560M fund. Hemant Mohapatra, a partner at the firm, explained that one of its strongest points of differentiation is that not many venture firms have such a global presence. “Our synergy with the global fund will continue,” he said.
It is one of the handful of American venture firms that aggressively scouts for deals in India. In the last 14 years, eleven early-stage bets have grown to become unicorns. Mohapatra said that the Indian start-up ecosystem has matured and demonstrates high-scale growth with big outcomes. It’s also seeing more exits than ever before. Indian start-ups raised more than US$ 14.5B in 2019, marking a record for the local community.
In addition, Mohapatra said a fraction of the firm’s portfolio start-ups has been disrupted by the coronavirus. However, most start-ups are marching ahead unfazed and some have accelerated in recent months. “Lightspeed believes this is when the best entrepreneurs and companies of the future will emerge. Strong founders are utilizing the tailwinds of India’s digital ecosystem growth to build out a new future and Lightspeed is strongly committed to backing these founders,” the firm said in a statement.