Fundamentum Partnership, a venture capital firm run by Nandan Nilekani, has secured $227 million for its second fund, a substantial portion of it coming from regional business owners and their private investment firms.
Sanjeev Aggarwal of Helion and Nilekani, cofounder and board chairman of Infosys, founded Fundamentum in 2017. Its initial fund had a value of roughly $100 million. La Caisse de dépôt et placement du Québec (CDPQ), a pension fund and institutional investor from Canada, made an investment in it as a limited partner (LP) in 2018.
With the new fund, which is larger than its prior fund by a factor of two, Nilekani's Fundamentum will continue to lead and co-lead series B and series C deals. In addition, the new fund is in discussions with institutional investors; if these discussions are successful, the fund's size might be raised to roughly $250 million.
The Fundamentum team has contributed one-fourth of the new fund's capital. Along with Pratik Jain, a principal at the venture fund, Ashish Kumar is a third cofounder and general partner at the fund in addition to Nilekani and Aggarwal.
With its first fund, Fundamentum invested in six startups, including unicorns like PharmEasy and the used automobile marketplace Spinny. According to Nilekani, the fund would keep placing focused bets rather than investing in companies "spray and pray."
“We believe series B and series C continue to be underserved. We have also created an advisory panel to help these companies on strategy, marketing, leadership development…as it goes back to our philosophy of giving not just money, but more,” said Nilekani, cofounder and general partner at the fund. He added the fund would look to invest in consumer technology companies and enterprise software-as-a-service (SaaS) startups.
“Our portfolio companies have raised over $1 billion in follow-on funding from marquee investors and that’s also a signal to incoming investors when we back them,” said Aggarwal.
In investment rounds between $25 and $40 million, in which it will typically invest $10 to $15 million, Fundamentum will try to lead or co-lead. According to its leadership team, the fund is also interested in making investments in cleantech and "Bharat" apps.
According to ET, the second fund from Fundamentum comes at a time when leading venture capital firms such Sequoia Capital, Lightspeed Venture Partners, Accel, and others have amassed a record $4.7 billion in dry powder in the first half of the year, up from $2 billion the previous year.
Kumar said the new fund will invest more frequently — about four-five times a year —than the previous fund, which made one or two bets a year.
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