Asset management firm Varanium announced first $30.5 M Venture Debt fund
With a greenshoe option of US $6.1 million, India-based asset management company Varanium Capital has announced the first close of its first venture debt fund, valued at 2.5 billion rupees (US $30.5 million).
The fund intends to support about 100 startups in India by combining traditional venture debt and revenue-based financing. Revenue-linked small ticket loans typically have a size between $150,000 and $350,000 USD. The range for conventional venture debt, meanwhile, is between US $1 million and US $1.5 million.
“Due to the funding winter and low equity dilution, there is a growing acceptance of venture debt and newer modes of financing like revenue-based funding. The opportunity for venture debt and revenue-based funding as a mode of financing is set to grow in the coming years,” media sources reported.
Startups in industries like direct-to-consumer, software as a service, business-to-business trade, and fintech will receive the majority of the venture debt fund’s support. Additionally, Varanium will give startups access to its vast network and mentorship programs.
The new fund chooses startups based on criteria like strong unit economics, recurring income from multiple sources, and an experienced founding team.
Family offices, extremely wealthy people, and business owners, including former bank CEOs and chief experience officers, have all pledged support. Varanium did not disclose the fund’s investors, but it did confirm to Tech in Asia that a US-based anchor was a participant.
Along with the new fund, Varanium Capital has also started a venture equity fund with a fintech focus and has so far invested in 12 startups, including Easebuzz, Riskcovry, Finvu, and Homeville.
