Lighthouse Funds raises $80 Mn, to close $200 Mn in third India-focused fund

Private equity firm Lighthouse Funds has raised $80 million in the first round of its third fund from existing investors, according to a report by DealStreetAsia.

The report added that the Mumbai-based firm aims to raise a total of $200 million for its third India-focused fund. Under the third fund, it plans to raise $50 million by the end of this year and the remaining amount by the first half of 2018.

“After the first close with the existing investors, we will have about $60-odd million more to raise, and we are hoping to get 3-4 new investors who believe in the India story and the Lighthouse story,” said Mukund Krishnaswami, founding partner of Lighthouse Funds.

Set up by Krishnaswami and Sean Novak, Lighthouse has raised two funds of $100 million and $135 million in 2009 and 2015, respectively.

“Our typical cheque size in Fund II has been between $10-15 million, and when I look forward to our Fund III, the investments could be between $10-20 million, we could move up to around Rs 120 crore. However, it won’t be drastically different from what we are currently doing, we like the space we operate in,” said Krishnaswami.

The PE firm has so far made 20 investments, of which, 11 were made from the first fund and nine from the second fund.

Some of the notable Lighthouse investments included leading snack foods firm Bikaji Foods International; personal care brand Kama Ayurveda; Kolkata-based diagnostic chain, Suraksha Diagnostics; agro-chemicals formulation firm Dhanuka Agritech Ltd; premium biscuit maker Unibic Foods; and others.

However, the PE firm has exited from many of them making multiples on invested capital.

From the total investments in 11 companies from the first fund, it has exited six, including Dhanuka Agritech and Unibic Foods, and made one partial exit in a company called XSEED Education.

This year, it also sold its stake in a Kolkata-based diagnostic chain, Suraksha Diagnostics.

The latest investment of Lighthouse was in the Kolkata-based food tech startup, Wow! Momo, in which it participated in the investment round of Rs 44 crore, at a valuation of Rs 230 crore.