Lightspeed India closes third fund at $275 mn, expands partnership network

Venture capital firm Lightspeed India Partners on Tuesday said it has raised $275 million from global institutional limited partners for its third fund. 

The early stage fund will continue to back companies in the seed and Series A stages, a statement said. It has so far invested $750 million in India, backing companies such as edtech major Byju’s, which was valued at $10.5 billion in its last funding round; B2B ecommerce marketplace Udaan, which was the quickest entrant into the India unicorn club; and regional language social media platform ShareChat. Lightspeed India also made a partial exit from budget hotel chain OYO in 2019.

The firm closed its second India-focused fund at $175 million in 2018 and its first fund at $135 million in 2015. 

While partners at the firm discussed investing in select companies at the Series B and Series C stages when Fund II was announced, the latest statement said that the capital for growth funding rounds will be directed from its global funds. 

“More than 80% of its (Lightspeed’s) investments have been committed to firms at seed or Series A stages. Lightspeed will continue to focus on early stages of innovation and work with founders to support them through their growth lifecycle – including the growth capital pool of over $3 billion raised recently in its global funds,” the statement said.

The India fund also announced an internal rejig to expand its partnership network -- it now has six members, including Harsha Kumar, Vaibhav Agrawal, Akshay Bhushan, Hemant Mohapatra, Dev Khare and Bejul Somaia, who are based out of Delhi and Bengaluru. The firm has also extended its portfolio service teams for executive recruitment, marketing and customer introductions, the statement said. 

Earlier this year, the Menlo Park, California headquartered firm announced raising $4.2 billion across three funds, including a $1.5 billion Lightspeed Opportunity Fund to back breakout companies in China, India, Israel, Europe and Southeast Asia. Lightspeed Venture Partners and its affiliates currently manage over $10 billion deployed globally, the announcement said.

Menlo Park, California headquartered Sequoia Capital is also in the process of raising $7 billion across separate funds for deployment in the US, China and India, according to reports. 

In December 2019, Palo Alto, California headquartered early stage venture fund Accel also announced a $550 million sixth India fund.