Nexus Venture closes $700 million funding for India, US-based startups

Nexus Venture Partners, which has backed unicorns like Unacademy, Postman and Delhivery, has closed $700 million in a new fund - Nexus Ventures VII - becoming the latest VC firm to raise a large corpus at a time when startup funding has dried up in the face of macroeconomic headwinds.

Through the fund, Nexus Venture Partners will invest in India and US-based startups and in sectors like artificial intelligence (AI), SaaS (software-as-a-service), fintech and commerce, the company has said in a blog post.

“There has been no better time for technology innovation. The pandemic has accelerated digital adoption worldwide across enterprises and consumers. Remote workforces have enabled startups to flourish by leveraging talent independent of geography. The recent breakthroughs in AI is enabling technologies to disrupt every sector faster than ever before,” the VC said in the blog.

“With one of the largest developer bases in the world, India is emerging as a key innovation and talent hub for global companies driving AI and software revolution. India is also among the fastest-growing economies on the planet, with accelerating digital consumption powered by best-in-class mobile data networks and advanced payments infrastructure,” the VC said.

Founded in 2006, by former entrepreneurs Suvir Sujan, Sandeep Singhal and Naren Gupta, Nexus Venture Partners is one of India’s earliest homegrown VC firms to invest in US and India-based startups. With the latest fund, the company would have total assets under management of $2 billion.

Nexus Venture Partners has backed close to 200 startups in India and the US to date, with more than 100 startups in India alone. The VC has six publicly-listed companies on its portfolio, including Zomato, Delhivery and MapmyIndia.

Nexus Venture Partners also counts eight unicorns in its portfolio. So far, it has largely participated in Seed and Series A funding rounds of startups and has backed enterprise applications and consumer internet companies.

Nexus Venture Partners’ new fund comes at a time when a lot of VC firms have raised large India-dedicated funds even as funding to the country’s startup ecosystem, which is currently the world’s third-largest, has fallen significantly in the recent past. Earlier this week, Moneycontrol reported how PE/VC (private equity and venture capital) investments tanked 77 percent in February from a year earlier, after hitting a 5-year low in January.

Nexus Venture Partners’ $700 million is also the second-largest fund raised by an Indian VC firm after Sequoia Capital India raised $2.85 billion to invest in India and Southeast Asian startups in mid-2022.