India: IFC proposes $20m investment in Chiratae Ventures’s fourth fund

Sudhir Sethi, Founder and Chairman, Chiratae Ventures, formerly IDG Ventures India

The International Finance Corporation (IFC), a member of the World Bank Group, is proposing a $20-million equity investment in the fourth fund of Chiratae Ventures, an early-stage venture firm focusing on Indian startups.

Chiratae debuted in India in 2007 as IDG Ventures India with a $150-million fund. It rebranded in October 2018 as part of what the company said was a broader strategy to move away from the global brand and appeal more to entrepreneurs in India.

Established by Sudhir Sethi and TCM Sundaram, the firm has invested in marquee brands including fashion e-commerce site Myntra (acquired by Flipkart), online kids and baby products portal FirstCry and Lenskart, among others. IDG also led a $120-million funding round for CureFit Healthcare Pvt. Ltd in July.

In India, Chiratae Ventures competes with early-stage investors including Accel Partners, SAIF Partners, and Kalaari Capital. Its target sectors include consumer media and technology, software and SaaS, health tech, and finch.

Chiratae is raising funds as Indian startups continue to see strong capital inflows despite macroeconomic headwinds. According to data from startup data tracker Venture Intelligence, $4.7 billion has been invested in Indian startups across 346 deals in the first seven months of the year.

That compares to the $4.3 billion raised across 338 deals during the same period last year.

In its disclosure, IFC said it proposes an aggregate of $20 million equity commitment in the firm’s fourth fund – Chiratae Ventures International Fund IV LLC. Details about the fourth fund were not immediately disclosed but earlier reports said it will have a much bigger corpus than the firm’s three previous funds.

Chiratae first raised $150 million for IDG Ventures India I LLC in February 2007. The second fund, IDG Ventures India Fund II LLC, raised $175 million in February 2013 while the third fund – IDG Ventures India Fund III – was closed in May 2016 with $208 million in total commitments.