Homegrown climate-and impact-focused venture capitalist Asha Ventures on Thursday said it has raised $50 million as the first close of its new $100-million fund to invest in 4-5 Indian companies every year.
Asha, which calls itself an early-growth stage investor as it backs ventures that have already generated revenue and have got their proof of concept, has so far built a portfolio of 13 companies, of which it has already clocked partial or full exits from four.
With the new fund, Asha Ventures Fund-I, the firm fund is looking to invest at an early growth stage in companies targeting the emerging middle class across sectors such as financial services, healthcare, education, climate and agriculture.
The fund has received commitments from domestic institutions, including Small Industries Development Bank of India (SIDBI), Self-Reliant India (SRI) Fund, a private sector bank, as well as family offices of some of India’s top business leaders who are returning LPs, Asha Ventures said.
The firm expects to hit the final close of the fund in 6-12 months.
The venture capitalist invests in the range of $2-5 million instead of a significant minority stake and counts Vastu Housing Finance, TrueMeds, and Adda247 among its portfolio firms.
DealStreetAsia was the first to report about the firm’s plans to launch the fund in August.
Concerns around global warming and the growing need for sustainable solutions to address climate change have drawn significant investor interest and funding in recent times.
Climate-tech investments in India touched $1.2 billion between 2016 and 2020, with a focus on renewable energy and electric mobility. However, to achieve India’s net-zero emissions goal by 2070, the country needs to scale up climate investments from $18 billion per year to $170 billion per year, according to the International Finance Corporation.
Besides Asha Ventures, some of the active investors in India’s climate-tech space include Blue Ashva, Speciale Invest, Climate Seeds Fund, Transition VC, and Climate Angels, EverSource Capital, a joint venture between private equity firm Everstone Capital and Lightsource BP; and Avaana Capital.
On the LP side, British International Investment (BII—formerly CDC Group) is also actively scouting for climate finance opportunities in the country.