Mumbai-based Artha India Ventures (AIV), the venture capital arm of the Artha Group, has announced the first close of its second early-stage micro venture capital fund, Artha Venture Fund II (AVF II), securing ₹250 crore. The fund is targeting a total corpus of ₹500 crore, with an additional ₹100 crore green-shoe option. This milestone signifies strong investor confidence in AIV's investment strategy and its ability to identify and nurture promising seed-stage startups.
AVF II will focus on backing 36 seed-stage startups across sectors including premium consumption, fintech infrastructure, applied AI, and deep tech. The fund plans to deploy initial cheques of ₹4 crore and participate in follow-on rounds with investments ranging from ₹8 to ₹16 crore. AIV is targeting a 15-20% ownership stake in its top-performing portfolio companies and will operate on a four-year deployment cycle.
Anirudh Damani, managing partner at Artha Venture Fund, noted that AVF II is launching during a "reset" in the startup ecosystem. He highlighted the reduced number of seed investments per month in India and a decline in the graduation rate from Seed to Series A funding. Damani stated that the early-stage investment ecosystem has become capital-starved, making AVF II's commitment even more crucial.
The first close of AVF II saw significant participation from Indian limited partners (LPs), comprising 90% of the commitments, including family offices and exited founders. The remaining 10% came from global investors. Early backers include Shahi Group, DSP Family Office, Narendra Karnawat of Glance Finance, and several successful founders from Artha's existing portfolio.
AIV currently manages four funds, each with distinct venture strategies. Its flagship Artha Venture Fund I, closed in 2021 with a corpus of ₹225 crore, has backed startups such as Agnikul Cosmos, Everest Fleet, and LenDenClub. Artha Select Fund, launched in 2023, selectively invests in winners from AVF I, while Artha Continuum Fund (ACF) operates on a deal-by-deal model, offering curated opportunities primarily to family offices. Artha Venture Fund-I has generated a 61% internal rate of return (IRR) at close.
Artha India Ventures has invested in 140 startups since 2012 from its three funds – Artha Venture Fund, Artha Select Fund (ASF), and Artha Continuum Fund (ACF). Its portfolio includes companies like OYO, Rapido and Purplle.
