Homegrown venture fund Arkam Ventures has received backing from top entrepreneurs such as ex-Flipart co-founder Binny Bansal, Paytm's Vijay Shekhar Sharma, SIDBI (Small Industries Development Bank of India), and US-based global fund of funds Capria.
Arkam, formerly known as Unitary Helion, is looking to raise Rs 700 crore by March 2021. It has already received commitments of Rs 325 crore for the first close of the fund, which would invest in early-stage technology startups such as education, healthcare, financial services and agriculture, according to a report in Livemint.
The fund has evaluated that these segments constitute around 70% of the spending by 400 million people in the country, the majority of whom reside in smaller cities and towns and whose annual incomes range between Rs 3-20 lakh.
The rest of the fund, around Rs 375 crore, is likely to close by the end of FY21.
Started as Unitary Helion, Arkam was launched in 2017 by Helion Venture Partners co-founder Rahul Chandra, and Kalaari Capital's Bala Srinivasa. The name was changed to Arkam to evade any confusion with now-defunct Helion Venture Partners.
Arkam Ventures looks to back 15 to 18 companies from its first fund across Series-A and B stages with an initial investment in the range of Rs 15-30 crore.
The fund has already made two investments - one in lending startup KrazyBee and business-to-business grocery platform Jumbotail, which provides supply chain solutions to Kirana (mom-and-pop stores) shops, the report added.
Arkam is also holding talks to close investments in three more startups over the next few months. These companies operate in agriculture technology and financial services sector.
"(This) market is very large, but has huge inefficiencies in the form of broken supply chains, limited access to credit, and outdated brick and mortar infrastructure, all of which was magnified during the COVID-19 crisis. Founders who combine a deep understanding of middle India and leverage technology to design low cost solutions and efficient new business models can build highly differentiated and scalable businesses," Kalaari's Srinivasa told the news daily.
Arkam Ventures has brought together a group of advisors comprising Reliance Jio president Vikas Choudhry, Big Basket human resources chief Hari TN, and Ravi Venkatesan, former chief executive officer of Microsoft India, who will help the fund make investment decisions and advise its portfolio companies.