Matrix Partners India, the Indian arm of US venture capital powerhouse Matrix Partners, has taken a bullish stance amidst the economic slowdown, amplifying its fourth India-dedicated fund to a whopping $525 million. This move was against the odds considering the current funding situation in the country. The venture capital heavyweight, known for its strategic investments in unicorn startups like Ola and Razorpay, had originally planned a fund size of $450 million, as per its submission to the US Securities and Exchange Commission (SEC) last June.
An upward revision, however, was made in April, swelling the fund size as confirmed by recent SEC documents. The filings also reveal that Matrix Partners has managed to accumulate $517.93 million so far. Moreover, the venture capitalist is in the process of setting up another fund—Matrix Partners India IV A, with a fundraising target of around $14.75 million.
A 2021 report from Moneycontrol predicted Matrix’s plans to raise a record-breaking $400 million for its India-centric fund. As an active early-stage investor in the Indian startup ecosystem, Matrix Partners India has an impressive portfolio with approximately 150 companies to its credit, standing tall alongside industry titans like Sequoia Capital and YCombinator. The firm has fueled the growth of eight unicorn companies, including OneCard, Dealshare, OfBusiness, and VerSe Innovation, the parent entity of Dailyhunt.
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This bold expansion of the fund size comes at a time when Indian startups are grappling with funding challenges due to unstable macroeconomic factors. Despite its reputation as an aggressive investor, Matrix lowered its investment activities by half in 2022, engaging in only 22 funding rounds, as per data from Tracxn Technologies. It hasn’t made any investments this year so far.
Interestingly, Matrix isn’t alone in scaling back its investments. Many venture capitalists, despite amassing or planning to raise substantial funds, have followed suit. Case in point, Sequoia Capital India secured $2.85 billion in June last year for investing in India and Southeast Asia but has only been a part of 11 deals in the first five months of 2023, a sharp fall from nearly 30 during the same period in 2022. Nexus Venture Partners, Accel, and Elevation Capital have also wrapped up their biggest-ever India-focused funds.
This news is based on an article from moneycontrol.
