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Avataar Capital Management Launches $300 Million Investment Fund, Avataar Venture Partners I

The VC firm has taken monetary support for the investor, HarbourVest Partners to create this fund.
BY Jaspreet Kaur
Feature Writer, BusinessEx
Sep 23,2019

Venture Capital firm, Avataar Capital Management has recently released its primary investment fund of $300 million. The investment fund is named Avataar Venture Partners I. The VC firm has taken the monetary support for the investor, HarbourVest Partners to create this fund. 

By introducing this new fund, the company will be focusing on infusing $10-$30 million investments in SaaS (Software as a Service) and B2B (Business-to-business) firms, as reported by the daily news, The Economic Times. 

US-headquartered investor, HarbourVest is one of the biggest private equity investment firms across the globe. By pumping in Avataar Venture Partners I, the PE firm has embarked its course in the Indian market as well as the South-East Asian market.

Acquisitions Made by Avataar Capital Management 

Several media reports confirmed that before closing the investment fund, Avataar has bought stakes in 6 Saas and B2B firms from the Norwest Venture Partners portfolio. Appnomic, an IT operations startup company, Capillary Technologies, an engagement commerce tool, CRMNext, a customer relationship management software, ElasticRun, a logistics startup firm, Manthan, a data analytics startup company and Zenoti, a Spa and Salon management software company are the six acquired firms. 

Avataar Capital Management is formed by Nishant Rao, former COO at Freshworks and Mohan Kumar, a former partner at Norwest Venture Partners.  

The two co-founders have not disclosed any deets relating to the acquisition of Norwest-funded firms. 

Prior to the acquisition, many firms in the Norwest portfolio have amassed money from investors. In August this year, Zenoti amassed $20 million funds from Steadview Capital. In May this year, Spa and Salon management software firm have also collected $50 million investment in Series C funding round from Tiger Global Management, as reported by the daily news, Inc42. 

In the previous year, Sequoia Capital and Warburg Pincus infused nearly $20 million in the engagement e-commerce tool, Capillary Technologies. 

Earlier in September, ElasticRun, a logistics startup company was in discussions to raise $50-$55 million in a funding round led by Naspers, as reported by the daily news, The Economic Times.  

According to the cited media report, the investment fund, Avataar Venture Partners will infuse capital between $10-$30 million in acquired firms, targeting to make 10 investments from its primary fund. 

Thriving SaaS in the Indian Ecosystem

The demand for SaaS is growing in the country and seeing its merits, its demand will continue to increase in the offing. According to the database company, NASSCOM, SaaS market in India is anticipated to increase 36 per cent yearly and reach $3.3-$3.4 million by 2022. The primary reasons for this growth are employing deeptech technology, increased talent, and grown sales niche. 

Recently, Freshworks, which is a SaaS unicorn, proclaimed to be launching is IPO by 2021. It is expected that the company will be listed at the US-based stock exchange, NASDAQ. 

This proclamation happened after SaaS company, Icertis joined the unicorn club this year. The firm has amassed $115 million in a funding round. 


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