The early stage seed investor, Blume Ventures will be launching a USD 50 Mn fund in mid 2014, reports ET. The firm is looking forward to an overseas institution-led fund, with plans to allot a significant portion to the existing portfolio companies.
As per Karthik Reddy, managing partner at Blume Ventures, 30% of the raised funds will be kept for seed stage investments, while 70 per cent will be reserved for follow-on rounds.
Blume Ventures’ second fund is expected to be registered either in Mauritius or Singapore, and will be 10-year fund, with an average investment holding period of about six years.
It is currently investing out of its INR 100-crore local currency fund, which it raised in 2012. The portfolio comprises of 85% Digital Media / Internet + Mobile startups with major focus on the pre Series A investment stage. Blume’s first cheques are of typically Rs. 50 lacs to 1.5 crores (approximately $100,000-$300,000) and 2x that range (where they co-invest).
In a span of around 2.5 years, Blume has invested in around 50+ companies. In November, the venture capital firm had its first successful exit after its portfolio company Qubecell was acquired by San Francisco-based mobile payments firm Boku.
According to data collated by global consultancy Ernst & Young, in 2013, 45 per cent of all venture capital deals comprised of first time fund raisers, compared with 41 per cent in 2012 and 36 per cent in 2011. Thus, highlighting the hike in the early stage funding in the country.
“There is far greater investment activity taking place in the seed venture space now. However, LPs are still going to be looking at a fund’s track record, before committing significant amounts of capital”, said Mayank Rastogi, partner – private equity and transaction advisory services at Ernst & Young.
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