Titan Capital readies Rs 300 crore 'Winners Fund', its first with external investors

Kunal Bahl (L) and Rohit Bansal (R), founder of Snapdeal and Titan Capital

Titan Capital, started by Snapdeal founders Kunal Bahl and Rohit Bansal, is setting up a new Winners Fund to back existing portfolio companies, people aware of the developments told Moneycontrol.

This will be a new fund where Titan Capital will be raising money from external stakeholders for the first time ever. So far, Titan Capital has only invested Bahl and Bansal’s personal money through its existing Seed fund.

Investors typically create a winners fund to back the same or similar assets in subsequent rounds. In Titan’s case, the winners fund will only back existing portfolio companies from the Seed fund and will not source new deals. This will help the fund participate in larger funding rounds at the Series A, B and C level.

“The winners fund will have a total corpus of Rs 200 crore with a greenshoe option of Rs 100 crore,” one of the persons quoted above said. Sizeable capital for Titan’s Winners Fund will come from Bahl and Bansal, with the balance coming in from external investors like high networth individuals (HNIs), family offices and others.

“The fund has already been oversubscribed since there has been a lot of interest from external stakeholders given Titan Capital’s track record. Titan Capital has delivered an Internal Rate of Return (IRR) of 65 percent in the last 13 years,” a second source told Moneycontrol.

It plans to close the fundraise by the end of the current calendar year, the source added.

Titan Capital did not offer comments for the story.

Nature of the fund
Through the Winners Fund, Titan Capital aims to participate in follow-on Series A, B and C rounds. “Titan wants to participate in subsequent rounds of its portfolio companies and the Winners Fund will give it that leeway since it will have a larger capital pool,” a person aware of the developments told Moneycontrol.

To be sure, Bahl and Bansal will continue to run AceVector, the holding company for Snapdeal, Unicommerce and Stellaro. The Winners Fund will be operated by a new team. The investor has appointed Chetan Rana as the Chief Financial Officer (CFO) of the Winners Fund and Shiv Kapoor as the Vice President (VP). While Rana was previously with WestBridge Capital, Kapoor used to be with Urban Company.

On average, Titan’s Seed Fund invests anywhere between Rs 5 and 10 crore and the average ticket size will be much higher in the Winners Fund.

Ola, Mamaearth, Razorpay, Bira91, Beardo are some of Titan Capital’s notable investments from the Seed Fund. It has made over 100-fold returns from its bets on Mamaearth, Ola and Urban Company.

For instance, Titan Capital had invested a total of Rs 2.4 crore in Mamaearth (Honasa Consumer) and earned Rs 160 crore from the bet. It still continues to hold some shares in the consumer brand.