Mumbai-based seed investor Blume Ventures which provides seed funding in the range of $50K – $300K to early-stage tech-focused/tech-enabled ventures, is close to raise $60 million second fund by December. The raised funds will be used to make investment in a dozen new startups a year for the next three years. The firm has also reserved Rs 20 crore ($3 million) from the first fund of Rs 140 crore for the follow-on investments in its existing portfolio companies.
Blume Ventures has so far invested in 70 companies, and expects to make eight investments by December while it had made a couple of fresh investments (15) so far this year. The firm has backed companies like MockBank, IDfy, GreyOrange, RailYatri, RoadRunnr, ReGlobe, Tookitaki, Purplle, and NowFloats among others. According to a report released by CB Insights in 2014, Blume Ventures was the most active VC firm in terms of unique companies invested in, closely followed by Accel Partners and Sequoia Capital India.
“We will write larger cheques—close to half a million (dollar),” Karthik B Reddy, managing partner, Blume Ventures said. Further he added, “In the first fund we used to do $200,000 (Rs 1 .3 crore) seed investment in each portfolio company. We will write $400,000-$500,000 (Rs 2.6 crore-Rs 3.3 crore) now on. Valuations have gone up, teams are getting better and we want to put more money.”
For its new fund, the VC firm will have four or five big institutional investors who would put in between $5 million and $10 million. As for domestic money, it will have a lot of individuals as the firm had in the first fund. “We are huge believers in domestic consumption but (it should be) mobile first. Consumer, small business and mobile first—that is the domestic story. But we are not afraid to invest in other areas such as SaaS, cross-border, deep technology, energy efficiency, robotics, medical devices, etc. About 40-45 per cent will be in such areas,” Reddy stated.
Blume has had good exits in the last one year as four of its investee companies – TaxiForSure, Promptec, ZipDial and 1acquired by Ola, Havells, Twitter and FreshDesk, respectively. “Right now we are in the fifth year of our first fund. The sum total is well above two times right now. But this are mostly paper as of now,” Reddy said about the performance of the first fund.