Prime Venture retains fifth fund size at $100 mn to back early-stage startups across sectors: Co-founder Sanjay Swamy

Subscribe to enjoy similar stories. Bengaluru: Prime Venture Partners, which has backed Indian startups such as MyGate and Niyo, has launched its fifth fund with a size of $100 million to continue investing in early-stage companies across sectors. The development comes almost four years after it raised $100 million for its fourth fund, which was later oversubscribed to $120 million.

While there is strong demand for the new fund, which may also be oversubscribed, this range is the preferred fund size, co-founder and managing partner Sanjay Swamy told Mint in an interview. “This is the right cruising altitude for an early-stage fund in India and that is what we are focused on," Swamy said on retaining the fund size. The previous fund sizes were $72 million (raised in 2018), $46 million (2015) and $8 million (2012).

Last year, Mint reported that venture capital firms including Stellaris Venture Partners and Blume Ventures adopted a similar strategy of retaining their fund sizes as investors took a more measured approach, reflecting the investable opportunities. This also underscores the tempered expectations from Indian startups as venture capital firms sit on sizable dry powder—capital yet to be deployed—having become more diligent on which entities to back. Prime’s first fund has been fully returned to limited partners at a multiple of 4x+ and the subsequent funds also expect top decile returns, driven by exits through initial public offerings and mergers and acquisitions, Swamy said, without disclosing exact figures.