VC firm 3one4 Capital raises ₹1,000 crore for its third fund

The venture capital (VC) firm had started raising its third flagship fund in 2020. It has raised five funds since its inception in 2016, including three flagship and two follow-on funds. It was set up by Pranav and Siddarth Pai, founding partners of 3one4 Capital, and counts Licious, Loantap, Koo and Darwinbox as its portfolio firms.

New investors in the third fund include CDC Group Plc., UK sovereign development finance institution, the Japan-India Fund-of-Funds-Nippon India Digital Innovation AIF (NIDIA); South Korean video gaming giant KRAFTON, Inc and prominent Indian endowments and foundations such as Catamaran and Premji Invest. The fund has also raised capital from a few large domestic banks and manufacturing, insurance and financial services companies.

“This is a combination of performance and the efforts that we have taken on the governance front and obviously the macro environment has been positive. Our startups have become larger, we have had our first unicorn and we’ll have more unicorns next year. On the governance front, we are now the first approved UN PRI signatory from India,” said Pranav Pai, founding partner, 3one4 Capital. “What has changed this year obviously is we have a record surge in liquidity, we have a record surge in VC investment in India and we have a record allocation of global pools of capital into the India strategy. All this has meant the Indian VC firms are now in demand,” he added.

Fund III will continue the investor’s focus on its core strategy to build a portfolio of 25-30 early-stage startups for each fund. It will back SaaS and enterprise automation, fintech, direct-to-consumer, digital media, and deep technology startups.