Venture debt firm Trifecta Capital closes its second fund at $140 Mn

Venture debt firm Trifecta Capital has raised $140 million or Rs 1,025 crore from domestic institutional investors, family offices and the Small Industries Development Bank of India (SIDBI) to close its second fund.

According to Trifecta, the fund had set a target of Rs 1,000 crore, including a greenshoe option of Rs 250 crore. Earlier, Trifecta had announced the first close of its fund at Rs 750 crore in March 2019. Now, it plans to launch its third venture debt fund with a size of Rs 1,200-1,500 crore in Q3 2021.

“Besides consistently beating the quarterly hurdle on returns for over five years across both funds, we have returned a significant portion of our first Fund to investors and are building a strong foundation for the future,” said Rahul Khanna, Managing Partner at Trifecta in a statement.

Predominantly backed by institutional investors including banks, insurance companies, development institutions, public sector entities, corporates and endowments from India and offshore, Trifecta claims to have invested around Rs 2,000 crore in 72 early growth and growth-stage startups.

The seven-year-old firm invests across domains like B2B, consumer services, consumer brands, e-commerce, mobility, edtech, agritech, fintech and healthcare. It’s portfolio companies include BigBasket, Pharmeasy, Cars24, Vedantu, Infra.Market, ShareChat, Dailyhunt, Urban Company, CureFit and BharatPe amongst others. 

Founded by Khanna and Nilesh Kothari, the firm also claims that its portfolio has cumulatively raised $8.1 billion of equity and nine of its portfolio companies have already become unicorns.

As venture debt has been gaining grounds in India, a host of new funds are coming up to cater to the growing demand. Mumbai-based IvyCap Ventures, Ankur Capital and Unicorn India Ventures are also toying with the idea of potentially having a debt fund. Stride Ventures that had started a venture-debt fund last year has quickly created a portfolio of over a dozen companies.