Private equity news india Private equity news asia SIDBI Startup Fund Invests Over Million in Anicut Capital

SIDBI Startup Fund Invests Over $6 Million in Anicut Capital

The Indian startup industry is a dynamic and rapidly growing sector that has attracted significant attention in recent years.

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With the support of initiatives such as the Startup India programme, the sector has seen a surge in early growth-stage companies, particularly in the consumer and technology sectors.

Anicut Capital, a venture debt investor, has been making waves in the startup industry, recently raising over $6 million for its equity investments fund from the Small Industries Development Bank of India’s Fund of Funds for Startups.

SIDBI Startup Fund Invests Over Million in Anicut Capital

Anicut Capital has invested in a diverse range of startups, including artificial intelligence and deeptech companies such as Agnikul and ChargeUp, as well as consumer brands like Bira and Sugar Cosmetics. With its Grand Anicut Fund 3, Anicut Capital is well-positioned to provide funding and support to startups at the series A and B stages.

SIDBI’s Investment in Anicut Capital

Anicut Capital, a venture debt investment firm, has secured an investment of INR 50 crore (approximately $6 million) from the Small Industries Development Bank of India’s (SIDBI) Fund of Funds for Startups (FFS).

As per a statement, SIDBI is an existing investor in Anicut Capital and has invested in both of its debt funds. The bank had invested INR 140 crore (about $16.9 million) in Anicut’s second debt fund.

Anicut Capital had launched the Grand Anicut Fund 3, also called Anicut Opportunities Fund, with a target corpus of INR 500 crore (about $60.3 million) and an additional greenshoe option of INR 250 crore (about $30.1 million) in June 2022.

The fund has invested in six companies within the first year of operations, including skincare brands Earth Rhythm and The Ayurveda Experience, footwear brand Neemans, fresh food supply chain startup Wheelocity, gourmet coffee roaster and cafe Blue Tokai Coffee, and mens apparel brand XYXX.

With its focus on the consumer and technology sectors, the fund aims to invest in 12-14 early growth-stage companies in the Series A and B stages across the Anicut and non-Anicut portfolios over the next 18-24 months.

Anicut Capital currently manages three debt funds, one angel fund, and one early growth equity fund, with cumulative assets under management (AUM) of INR 1,600 crore (about $192.9 million). The firm has backed several successful startups such as Wow! Momo, Bira, Sugar Cosmetics, ShareChat, Agnikul, and ePlane, among others.

SIDBI’s FFS is a fund launched under the Startup India Initiative of the Indian government in January 2015. It contributes to the capital of Securities and Exchange Board of India (SEBI)-registered Alternative Investment Funds (AIF) instead of investing directly into startups. Other funds that have closed investments from FFS include early-stage venture firm Pi Ventures, which invests in artificial intelligence (AI) and deeptech startups.

“This investment isn’t just a vote of confidence in Anicut, but a strategic alignment aimed at boosting India’s evolving entrepreneurial landscape. We anticipate this collaboration to result in substantial, high-impact outcomes that will benefit the broader business community and contribute to the nation’s economic prosperity,” said SP Singh, CGM Incharge, Venture Finance, SIDBI.

“We are humbled to onboard SIDBI as an investor through the FFS initiative. Receiving funds from SIDBI’s FFS is a testament to our meticulous investment strategies and the robust portfolio we are building,” said Ashvin Chadha, founding partner, Anicut Capital.


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