Trifecta Capital, which has backed the likes of BharatPe and Cars24 in India, has closed its third fund at $213 million (Rs. 1,777 crores), more than a year after its initial target to close the fund.
The fund, which was launched in September 2021 with a target corpus of Rs 1,000 crore and a greenshoe option of another Rs 500 crore, was initially planned to reach its final close in Q1 2022.
Without disclosing more details, the firm said it expects to launch its fourth venture debt fund in early 2024.
Along with existing investors, the third fund also saw participation from a variety of new investors including large global financial institutions, domestic conglomerates, banks, insurance companies, development financial institutions, public sector entities, and family offices, Trifecta said.
Trifecta Capital has already invested Rs 1,500 crore from Trifecta Venture Debt Fund – III in the last 21 months, and over Rs 5,000 crore of venture debt across 150 startups cumulatively across all its venture debt funds.
Given the slowdown in venture capital investing, the fund said it has been very selective with new investments. Its portfolio companies include Zepto, The Good Glamm Group, Log9, Kissht, Rebel Foods, Cashfree Payments, Ripplr, Bira91, WizFreight, Biryani By Kilo, Infra.Market, Udaan, Globalbees, Eatfit, Practo, Shadowfax, Chalo, Blusmart, Celcius and Captain Fresh.
The closure of the fund comes at a time when venture debt is fast becoming a viable alternative to equity funding amid the prolonged funding winter.
Debt infusion into Indian startups stood at $206.2 million in 2022. While this was 25% below the peak of $277.3 million seen in 2021, it more than doubled from $91.7 million in 2020, according to data from Tracxn.
Founders are now becoming more privy to alternative sources of finances, compared with 2021, Ishpreet Gandhi, founder at venture debt firm Stride Ventures, said at a panel titled ‘Beyond Winters: Funding strategies amidst a downturn’ at DealStreetAsia’s Asia PE-VC Summit 2o23 in Singapore on September 5-6.