Nine months after Sequoia India announced a split from its parent venture capital firm, the re-branded Peak XV Partners has told its investors it will launch a perpetual fund that will 'create a culture of high accountability and alignment with LPs (limited partners)', according to people close to the development.
Sources said that this permanent capital vehicle will have the Peak XV team's own capital and not raise any cash from LPs. The vehicle could invest in Peak XV's own future funds, other venture funds or even deploy capital in other assets in the future. It will not directly hold the shares of any Peak XV portfolio companies.
"It does not change anything for LPs who have invested in Peak XV's venture funds... Peak XV shared this development with over 100 global investors who gathered for a two-day meet in Delhi, the largest gathering of Limited Partners in the region," said a source.
An internal Peak XV memo accessed by Moneycontrol states that half a dozen limited partners of the VC firm have shown 'resounding enthusiasm' for the move.
TechCrunch was the first to report this development.
The VC firm's private portfolio includes unicorns like Byju's, Razorpay, Cred, Cars24, and public portfolio includes companies like Pratap Snacks, Indigo Paints, Five Star Business, and Zomato (through the stock swap deal with Blinkit), among others.
"We are thrilled to share that we will be launching the Peak XV Anchor Fund a permanent capital vehicle funded by the Peak XV team. Through the new Anchor Fund, we will aim to be a significant investor in our future funds. There will be no change to how Limited Partners (LPs) invest with us. As you know, we have dozens of amazing non-profit institutional LPs and serving their great causes will continue to be our north star," the letter said.
"The Peak XV Anchor Fund will create a culture of high accountability and alignment with LPs, and bind the team together for the long-term. It will also provide us with a differentiated capability to grow as an institution. We plan to leverage this internal balance sheet to invest in and partner with other fund managers across regions, strategies and sectors. This will enable us to create a global network for learning and collaboration," it added.
"As we were designing the Anchor Fund, we got preliminary feedback from more than half a dozen LPs and there was resounding enthusiasm for this idea and for the alignment this will result in," it further said.
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