According to two people familiar with the matter, Lightspeed India Partners is looking to raise more than $500 million for its fourth fund, as one of the most successful venture funds in the world’s second largest internet market looks to double down on early-stage bets and expand its focus to Southeast Asia. The firm, whose portfolio includes edtech giant Byju’s, budget hotel chain Oyo, e-commerce Udaan, social media app ShareChat, HR tech DarwinBox, jobs platform Apna, and Indonesian e-commerce Ula, has received inbound interest to raise more than $1 billion, but one of the sources said it is likely to close the fund at slightly more than $500 million.
According to the source, the ongoing discussions for the new India fund are part of Lightspeed Venture Partners’ global attempt to secure around $6 billion for a number of its funds. The India fund is scheduled to close in the next three to four months, according to the person, who asked to remain anonymous since the topic is confidential. Two years ago, Lightspeed raised $4 billion for many of its funds. Lightspeed India Partners’ fourth fund, estimated to be worth $500 million or more, will be the firm’s largest to date. The business, which has been working in India for over a decade and launched its first country-specific fund in 2015, announced the closing of its third fund in 2020, which raised $275 million.
There are no big modifications in the firm’s investment strategy in the works. With the new fund, it expects to continue to back early-stage investments in a range of industries, as well as extend its emphasis on Southeast Asia and aggressively investigate prospects in web3, according to a source. The bigger fund will be useful since the number of entrepreneurs and the median amount of money raised in seed and Series a funding rounds has increased in recent years in the United States. Last year, Indian entrepreneurs raised a record $39 billion, nearly tripling the previous high of $14.6 billion in 2019.
SoftBank, Alpha Wave Worldwide, and Tiger Global, the firm’s global counterparts and rivals, increased the pace of their investments in India last year. Last year, SoftBank alone spent over $3 billion in Indian businesses, with ambitions to invest up to $10 billion this year, according to the company. Other firms, including as Insight Partners and Bessemer, have increased their presence in the nation in recent quarters. The new fund’s discussions come only weeks after Accel announced its sixth India fund, valued at $650 million. According to the CapTable, Sequoia Capital India is also aiming to raise a substantial fund.