India presents an unprecedented chance for investments: Ankur Capital MD

Ankur Capital secures key commitments for Rs 1,200 crore fund

Early-stage venture capital firm Ankur Capital, which is in the process of raising its third fund with a target of Rs 1,200 crore (around $150 million), has received commitments from two of its existing limited partners (LPs).

Both British International Investment and the John D. and Catherine T. MacArthur Foundation will be part of the third fund as well. They join the US International Development Finance Corporation (DFC) and the Self-Reliant India Fund, which had committed to the fund earlier.

Ankur Capital's third fund will invest in "disruptive technologies with themes tapping into the digital transformation and decarbonisation opportunities for both India and beyond."

At a time when the Indian startup ecosystem is recuperating from the so-called funding winter, which continues to linger, early-stage venture capital (VC) fund Ankur Capital is bullish about the future of the country's entrepreneurial landscape.

Having made follow-on investments in its portfolio companies last year, Ankur Capital plans to make four to five investments this year, said Ritu Verma, co-founder and managing partner at the firm.

"We believe India presents an unprecedented opportunity with a vibrant ecosystem built over the past years. We have seen the underlying change and growth over the last 5-10 years. We believe that there is a lot more to come, driven by the dual tailwinds of digitisation and decarbonisation," she told Business Standard.

Founded in 2014, the firm has been investing in digital and deep science technology companies that are "building breakthroughs for a better world," with the aim of unlocking opportunities in overlooked markets from India to the world.

With Fund III, Ankur will continue to focus on pre-Series A investments, and will have entry check sizes in the range of $1-2 million, with support continued up to $10 million.

Ankur Capital manages over $200 million in assets under management (AUM) across its previous funds. The firm raised its first fund in 2017 with a corpus of Rs 50 crore, while its second fund, launched in 2020, raised Rs 380 crore. According to Verma, the firm has deployed over Rs 400 crore in 30 companies across its previous funds, with the second fund nearly fully deployed.

These include investments in companies such as seafood B2B platform Captain Fresh, biotech startup String Bio, battery chemistry developer Offgrid Energy Lab, and agri-inputs marketplace BigHaat.

With a large portfolio in agritech, deep science, and climate sectors, Ankur expects to continue leveraging these areas while expanding into newer themes.

"At Ankur, we continue to be attracted to entrepreneurs creating the next generation of technologies across sectors and are particularly bullish about deep science technologies, agritech, and climate opportunities," Verma said.

This comes at a time when funding among Indian startups declined 13 per cent year-on-year to $4.1 billion in the first half (H1) of calendar year 2024 (CY24), as the so-called funding winter continues to linger, according to market intelligence platform Tracxn.

However, on a sequential basis, funding rose four per cent Y-o-Y from $3.96 billion raised in H2 CY2023 after four consecutive half-year periods of declining funding, indicating that the startup world is on the path to recovery.

"We believe there are many interesting entrepreneurs with businesses solving critical problems in the market for us to support. We are also seeing funds for companies that are performing well. While the pace is slower, the opportunity still remains," Verma said.