Bertelsmann VC's Indian arm fetches $500 million for investment in Indian companies

29 Jun 2022 , 10:10 AM

Bertelsmann India Investments (BII), Bertelsmann’s investment division, has raised $500 million to make new and follow-on investments in India over the next few years.

While the venture capital (VC) firm will continue to invest primarily in mid-stage companies – startups in Series B and Series D – it also plans to fund select Series A new-age companies, which it has not done previously.

When asked how BII would select companies for this pool, Makkar stated, “We want to invest in companies that leverage technology to solve problems in a highly unorganized market.”

He added further, “We plan to invest between $5 million and $20 million at first. As companies perform well over time, we may be able to increase our investment size to around $40 million in a single company – at various stages.”

Furthermore, BII stated that it intends to invest in sectors such as technology, software, tech-enabled health tech, the future of work, fintech, and agritech. With plans to open more offices in India and the region, the fund will also keep an eye on disruptive technologies such as web3 and deeptech.

BII has recognized the potential in the Indian startup ecosystem and has decided to invest in select companies in the Series A stage, which have demonstrated greater resilience than their late-stage peers, where valuations have corrected by 30-40% as tech stocks continue to underperform and capital has been difficult to come by, stated Makkar.

When asked why BII had finally decided to fund Series A companies, Makkar explained that these companies have more room to grow, disrupt, and build businesses for the longer-term macroeconomic conditions.

BII said it will make six to eight new investments a year from the fresh pool.

Since its debut in 2013, BII has backed over 17 companies, including a few unicorns such as Licious and Eruditus. Other portfolio companies include Shiprocket, Pepperfry, AgroStar, and Lendingkart. So far, the VC firm claims to have invested approximately $285 million in Indian startups.