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Trifecta Capital announces first close of Rs 1,500-crore late-stage fund


Mumbai: Within three months of launching a late-stage fund, venture debt firm Trifecta Capital has announced the first close at Rs 1,000 crore ($130 million) with the domestic portion oversubscribed.

The fund
is looking to raise a total of Rs 1,500 crore from domestic as well as global investors and is targeting a final close by the end of this year.

Trifecta will invest in late-stage tech startups that are likely to seek liquidity outcomes over the next 12-36 months. It has already made commitments to back five companies from the corpus raised.

Large corporates, insurance companies, family offices, ultra high net worth individuals and entrepreneurs have invested in the fund so far. Existing sponsors of Trifecta’s venture debt funds have also made significant investments in this fund, according to a statement. “For the balance Rs 500 crore, the firm is in discussions with several domestic and global institutional investors,” the release stated.

The fund will invest Rs 100-200 crore each in 10-12 companies for minority stakes, through a combination of primary and secondary positions.

This style of investing helps late-stage companies as it provides off-cycle liquidity to early investors, angels, current and former employees, and includes consolidation of equity cap tables.

Trifecta Capital, across its two venture debt funds, has invested in more than 75 companies, including BigBasket, Pharmeasy, Cars24, Vedantu, Infra.Market, ShareChat, DailyHunt, Urban Company, CarDekho, Blackbuck, Ninjacart, NoBroker, Kreditbee, Dehaat, Turtlemint, Livspace, Mobikwik, Ixigo and BharatPe.

“With strong institutional investor interest in India internet, we expect listings of several large well-known startups, and creation of liquidity for existing investors as these companies tap the public markets for their longer-term financing needs,” said Rahul Khanna, managing partner at Trifecta Capital.

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Founded by Khanna and Nilesh Kothari in 2014, Trifecta Capital offers financing and advisory solutions. As of June 30, 2021, it has raised over Rs 1,500 crore across two venture debt funds.

As an increasing number of startups line up initial public offerings, late-stage is emerging as a big investment class for such funds.

This week, Trifecta Capital’s fund was part of the consortium
which invested $53 million as primary and secondary capital in travel search engine Ixigo, which is looking to list by the end of the current calendar year. Other startups that are looking to go public include
Nykaa,
Paytm,
Policybazaar,
MobiKwik and
CarTrade.

Earlier this year, IIFL AMC, the asset management arm of the financial services group, said it was looking to invest in pre-IPO and late-stage rounds of internet economy companies using its new Rs 1,500-crore fund. Others, such as Bay Capital, too are looking to back late-stage, IPO-bound companies.



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