Former Reliance Jio executive raises $130 mn to back mid-market startups

livemint.com:

Myntra, Fractal, Nazara, Policybazaar and Rapido. Playbook’s fund will invest in growth-stage, tech-enabled businesses in large addressable markets that have meaningful scale, healthy operating margins, and high growth. With an average ticket size of $10-20 million, the fund will roughly constitute about 15-20 investments across various sectors including health-tech, SaaS, fintech, ecommerce and supply chain.

The fund will have a mix of primary and secondary investments and will target stages between series B to D. “We are already looking at 4-5 companies very actively and are in advanced discussions," Choudhury said without disclosing any names. Growth capital is a type of private equity instrument that takes a minority stake in mid-market or relatively mature companies to help them expand their business operations.

This investment instrument aims to fill the white space between private equity and venture capital and typically targets companies that are already profitable. In an interview with Mint, Choudhury highlighted that Playbook’s fund will typically target those companies that, on an average, clock ₹100-200 crore in revenue with a definite product-market fit and a demonstrated ability to grow with sustainable unit economics. He also stressed the importance of identifying visionary founders with an ability to create meaningful outcomes in large addressable markets, especially in instances when investors enter at an early stage.

“India is ultimately a play on volume. The key is to see if a company can deliver affordable products to customers at scale," Choudhury said. As far as opportunities in the growth stages are concerned, “there are enough if priced correctly," he added.