Jupiter Capital aims to be a $1 bn AUM VC instead of Rajeev Chandrasekhar’s family office

Jupiter Capital is in the process of obtaining required regulatory approvals to begin investing from its recently announced $150 million fund, which the Bengaluru-based company hopes will help it to transform to a specialised venture capital fund from being the family office of Rajeev Chandrasekhar.

With a strong focus on business-to-business (B2B) Software-as-a-Service (SaaS), Jupiter aims to be a billion-dollar asset manager in seven years, David Abikzir, Chief Investment Officer and Executive Director, Jupiter Capital, told Business Today.
 
After fully investing the maiden fund -- J1 Capital -- in the first full year of operation plans to launch two more funds of $350 million and $500 million each, to reach its $1 billion assets under management (AUM) target.
 
“We want to become a billion dollar asset manager in seven years. It will take three funds to become a $1 billion asset manager. This is what we are building right now,” Abikzir.

While the family office will be an anchor investor at 20 per cent, J1 Capital will raise a majority of the capital from domestic and global institutional investors. Abikzir said the fund has secured capital commitments from investors including other family offices to complete a first close of $50 million in the first quarter of financial year 2023. It plans to raise the remaining $100 million from domestic and global limited partners (LPs) in the next 6-8 months.

“I want to create dynamics with this brand, I want the team to be recognised as a good unit to invest in, and create returns for LPs in the market. We will be one of those rare companies that have transformed from being a family office to a real venture capitalist firm, to be recognised by the community of investors,” he said.

“It will take a good year of transformation to fully metamorphose from a family office to a venture capital fund. Rajeev himself is a brand, we want to do it independently. First step is to change the perception of the brand in the market.  We want Jupiter Capital to be recognised as an investing brand, and not as a family office.”

Abikzir said Chandrasekhar will have zero implications on the fund, which will have blue-chip institutional LPs from India and abroad. “Today in Jupiter Capital, Rajeev has no implications, zero. He will be just like any other LP,” he added.

The Category II Alternative Investment Fund is currently awaiting approval from the Securities and Exchange Board of India (SEBI) to make its first close and begin investments.

JC1 will make 20-25 investments with a ticket size in the region of $2-10 million in Series A B2B SaaS and consumer brands. A majority of the fund, 70 per cent, is earmarked for B2B SaaS opportunities, while the remaining pool of capital will be used for opportunistic bets on consumer brands. It will also keep aside $20 million for follow-on investments. In the consumer brands segment, the fund will look into F&B brands, cosmetics and other business-to-consumer (B2C) products.
“The B2B companies, even if well established in India, are having a hard time entering Europe and the US. We have identified that whitespace in the market. We come with a deep entrepreneurial mindset, not only as an investor, but with a capacity to execute and sign contracts abroad,” he said.

Abikzir, who previously worked with a $6 billion CDC IXIS Private Equity fund, said the company has already identified the 20-25 startups it wants to invest from the first fund.
 
“I’m very confident of closing all 25 deals in FY23. These are picked from close to 1,000 companies that we have evaluated in the last 8-12 months. If I have the accreditation and license today, I could close the investments in the next three months,” he said.
 
Jupiter Capital, a private equity and debt investment firm launched by entrepreneur and union minister Chandrasekhar, began with an initial investment of $100 million in 2005. It operates in nine countries and backs brands and companies across a range of sectors, including technology, media and entertainment, wellness and hospitality, infrastructure and real estate, and corporate aviation.
 
The family office will continue to operate as a separate unit. Business Today recently reported that the fund is venturing into the fast-moving consumer goods (FMCG) space with a slew of wellness and leisure lifestyle products, beginning with beauty, wine, and coffee.

Also read: Jupiter Capital forays into FMCG segment; to launch luxury wellness marketplace