Pavestone Capital, a Hyderabad-based venture capital firm, has hit the final close of its maiden fund at Rs 816 crore ($97 million), surpassing its initial target of Rs 600 crore, to back early growth-stage B2B technology companies.
The fund has attracted investors, including the Self-Reliant India (SRI) Fund, the family office of Mankind Pharma promoters, and Colruyt Group India, among others.
The Pavestone Technology Fund invests in technologies like applied and Gen AI, immersive reality, cloud computing, advanced connectivity and cutting-edge engineering in mobility, material science, bioengineering and space. The fund also considers secular trends like digitalisation, ESG, and global supply chain realignment.
The Pavestone Technology Fund has invested in E42, Bellatrix Aerospace, LivNSense, NewSpace Research & Technologies, and Cynlr.
The fund, which has an eight-year tenure, is looking to invest $3-8 million across seed, pre-Series A and Series A startups. It has earmarked as much as 80% of the corpus for B2B startups, while the remaining 20%, the firm’s executives said, will go to new-age technology startups.
A spinout of Parampara Capital, Pavestone marked its maiden close at $52.54 million for its first fund early last year. The firm was supposed to close the fund by the end of 2023, but the process got delayed due to the new circular by the Reserve Bank of India on Alternate Investment Funds (AIFs).
In Dec, RBI directed banks, non-bank lenders and home financiers not to invest in AIFs, who have directly or indirectly invested in companies that have borrowed money from the lenders.