Former Partner at Norwest Venture Partners, Mohan Kumar, and former chief operating officer of SaaS firm Freshworks, Nishant Rao, have launched $300 million worth India focused fund – Avataar Venture Partners.
The fund, which will mainly invest in business-to-business (B2B) and Software-as-a-Service (SaaS) companies, has got backing from HarbourVest, the global fund-of-funds as its single Limited Partner or sponsor.
For the unaware, the Boston-based private equity firm has $64 billion in assets under management.
Avataar Venture Partners will typically put in $10-$30 million in its portfolio companies, aiming to make about ten investments from its maiden fund. According to Kumar, the firm targets to back companies with at least $15 million in recurring revenue, and scale that to $100 million.
Headquartered at Mauritius, Avataar Venture Partners will also be shelling out $180-200 million to buy stakes held by Norwest in its six portfolios of companies – Zenoti, Capillary Technologies, Appnomic Systems, CRMNext Inc, Manthan Systems and ElasticRun.
The companies mentioned above were part of Kumar’s portfolio during his time at NVP. He had also advised Attune Technologies, Borqs, iProf, NationWide Primary Healthcare Services, Ovum, Perfint Healthcare during the tenure at the US-based venture capital firm.
Of the six companies, logistics and distribution network ElasticRun was in talks to raise $50-$55 million round led by Naspers whereas Zenoti has raised an estimated $70 million from Steadview Capital, Tiger Global and others.
This will be in additional capital for these six companies, which will help them to bring in operating skill sets from areas like scaling sales and marketing, especially in markets like the US.
Besides, the fund will help them to prepare for IPOs and strategic sales.