Capital A Launches INR 400 Cr II Fund, Invests in 20 Startups

The fund will focus on startups operating in sectors such as manufacturing, deeptech, climate technology and fintech.

Capital A plans to back 17-20 companies and provide $2-3 million in funding over the life cycle of each startup

Through Fund I, the VC firm has invested in startups such as Chargeup, Bambrew, Jiraaf, Leumas BharatSure and Entuple, among others

Venture capital (VC) investment firm Capital A has launched Fund II with a target capital of INR 400 Cr (approximately USD 48 million).

The VC firm said Fund II will invest in 17 to 20 startups and will pay checks of $2 million to $3 million over the life cycle of each startup. The initial investment will be between $750,000 and $1 million, the investment firm said in a statement.

The fund will primarily focus on startups from various sectors such as manufacturing, deeptech, climate technology and fintech.

The second fund, which is scheduled to close by the end of 2025, will be backed by family offices, industry leaders, high net worth individuals (HNIs) and other investors. Many of the firm’s original Fund I backers are also expected to return.

“Our promoter-led experience gives us a distinct advantage in identifying and growing opportunities in sectors like green technology and fintech,” said Ankit Kedia, founder and lead investor at Capital A.

Founded in 2021 by Kedia, Capital A backs early-stage startups in fintech, cleantech, and other emerging sectors. It has invested in high-profile startups like Chargeup, Bambrew, Jiraaf, Leumas BharatSure, and Entuple through its Fund I.

The development comes at a time when the Indian startup ecosystem is experiencing a capital drought due to the ongoing funding winter. With a focus on profitability, VC and PE firms are sitting on the dry dust of billions of dollars they have raised over the past two years.

But as market conditions improve, more funds are lining up to raise capital from limited partners (LPs). On Thursday, another early-stage VC firm, z21 Ventures, reported the first close of its $40 million Fund II at $20 million.

Earlier this month, Vikas Choudhary-led Playbook Partners came out of stealth and announced the first close of its maiden $250 million fund at $130 million. Venture debt investment firm VentureSoul Partners also reported the first close of its maiden $600 million fund at INR146.5 million in September.