Newly launched early-stage venture fund Ideaspring Capital, with a targeted corpus of Rs 125 crore (around $18.8 million), is set to achieve its first closure by next month.
Naganand Doraswamy, managing director and CEO of Ideaspring, said that the Bangalore-based fund is expected to hit its first closure of Rs 90 crore by next month.
"We hope to achieve full closure within the next four months," Doraswamy added.
The fund will invest up to $450,000 (around Rs 3 crore) in early-stage tech startups, besides participating in pre-Series A/Series A funding rounds where it will pump in up to $750,000 (around Rs 5 crore) as a co-investor. The firm is targeting four to six early-stage deals each year for the next three years.
Ideaspring will also help its portfolio companies reach their next stage of funding within 18 months from the time of their association.
According to Doraswamy, both early-stage funding and mid-stage funding will have an allocation of Rs 50 crore each from the fund. The remainder will be used as buffer funds.
Launched this month by angel investors Naganand Doraswamy and Prashant Deshpande, Ideaspring Capital will provide funding to tech startups that operate in the space of machine learning and deep learning, computer vision and image processing, big data analytics, Internet of Things, augmented and virtual reality, health-tech and fin-tech.
"B2B (business to business) companies that are of high quality are in demand right now and they also require smaller levels of capital unlike a B2C (business to consumer), where there is always a potential high burn rate," said Infosys co-founder and Aarin Capital chairman TV Mohandas Pai, who is the anchor investor in Ideaspring.
Doraswamy said that the key differentiator for selecting startups would be intellectual property (IP). "We realised that there was not very strong funding support for entrepreneurs who were working on product. Most of the funding was going towards business innovation," said Doraswamy.
Ideaspring has also roped in Patni Computers' scions Arihant Patni and Amit Patni, among others, as its backers. While TV Mohandas Pai and Amit Patni will serve as general partners, Arihant Patni comes in as managing director of the fund, along with founders Doraswamy and Deshpande. Entirely backed by Indian capital at present, the investment firm is open to getting foreign backers on board.