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Are you looking for the best venture capital firm for your business? Keep reading this blog and you will find out the top 10 venture capital firms in India in 2021.

Top 1o venture capital firms in India
Image by: Markus Winkler

But, why should any start-up or new business owner find the best Venture capital firms?

Ok, so to start, let us understand for whom venture capital is the best choice for collecting funds. Those businesses or start-ups which are still in a very early stage of their business yet showing promising results and need proper financial support should look for venture capital firms

India is the third-largest county when it comes to start-up ecosystems. That is great news for Indians. Many new businesses are prospering and helping the country grow with solid support from venture capital firms. 

According to an Economic Times report, there were around 14,000 star-ups in India. Woah! I know that is a massive growth from 733 in 2020.

Now, let us dive straight into our top 10 venture capital firms list in 2021.

I have divided this list into two sections.

1. VC firms founded and headquartered in India, 

2. VC firms founded and operating in foreign countries – investing in India. 

Great! So, now you can choose if you want to be involved with someone to whom you can reach out whenever you are in need or go with the best VC in the world who are willing to invest in Indian start-ups.

Indian Venture capital firms – Investing in Indian start-ups

Top 10 Venture capital frims in india

1. Blume ventures

About the venture capital firm

Blume ventures were started in 2010 by Karthik and Sanjay. Do you know what makes Blume into our list? it’s the fact that from 2011 to 2018, Blume registered a 50% increase in its portfolio, and if you know a little about VC firms then you can also say that this number says a lot about the firm! 

Into what industries do Blume ventures invest?

Blume invests heavily in sectors like healthcare, travel, commerce brands, jobs, and education. Their second-highest funding amount goes to the software tech sector. 

Some of the start-ups’ bloom has invested in are; purple, Unacademy, Instamojo, and HealthifyMe. How to choose portfolio companies can be learned from Blume because their portfolio companies are making a great shift into their respective fields.

To know more about them, you can contact them at [email protected].

2. Kalaari capital

About the venture capital firm

Kalaari was founded by Vani Kola. Kalaari focuses on investing in Indian start-ups. Their vision is to help the Indian start-up ecosystem grow. So, if you are an Indian start-up owner, your chances are good to get invested by Kalaari.

Into what industries do Kalaari capital invest?

Kalaari investes in over 90 start-ups.They Majorly invest in consumer tech, Content, Crypto, E-commerce, Edtech, Gaming, and more. A few of the start-ups Kalaari invested in are; Cashkaro, Curefit, Dream11, Haptik, Myntra, Myglamm, and more.

3. Nexus venture partners

About the venture capital firm

Nexus venture partner started in 2006 by Suvir Sujan and Sandeep Singhal. It was one of the first Indian-US VC firms investing in global- tech companies and tech lead businesses for India.

Into what industries do Nexus Venture Partners invest?

Nexus venture partners invest heavily in Global-tech, healthcare, Consumer-centric brands, and others.

A few of the companies in Nexus venture partners invested are Snapdeal, Crafstvilla, Pratilipi, Urbanic, Zepto, Zomato, and more. Although their portfolio might be smaller than a few others but, their companies are very well choosen.

To know more about nexus venture partners, go to www.nexusvp.com.

4. Indian angel networks

About the venture capital firm

Padmaja Ruparel, Raman Roy, and Saurabh Srivastava founded Indian angel networks in 2006. It is a Delhi-based VC firm. The members of the network have themselves been a vital part of start-up companies. Hence, they can share their operational experience with new start-up owners

Into what industries do Indian angel networks invest?

Indian angel networks invest in many sectors like; Agriculture, Education, Financial Services, Gaming, Retail, Hospitality, Services, and more. A few of the companies Indian angel investors invested in are hungry zone, Box8, Faballey, Wildtrailes, Zippr, and others. We can say from their portfolio companies that they are investing in promising new start-ups because these companies are already showing good results in their starting years.

To know more about the Indian angel network, go to www.indianangelnetwork.com.

5. Yournest

About the venture capital firm

Sunil K Goyal and Sanjay Pande founded Yournest in the year 2012. It is an early-stage funding VC firm located in Gurgaon. Did you know Nearly 40% of their fund-1 investors also make it to their fund-2? They have also launched fund-3 in 2022.

Into what industries do Yournest invest?

Yournest majorly invests in Deep Technology, Content, AI, Consumer-centric brands, and others.

A few companies Youngnest invested in are; Momspresso, TWID, Thriwe, Practically, Dozee, and others. Well, good for India’s economy because, It looks like they totally get which new-age companies are going to make it big!

To know more about Yournest, you can go to www.yournest.in.

So, these were our top 5 VC firms founded by Indians and based in India. Now, let’s get some information about international VC firms as well. These are basically for those start-up owners who do not mind having their Investors in different counties and who want to have networks with other international Owners.

Foreign Venture Capital Firms – Investing in Indian start-ups.

Top 10 Venture capital firms in India
Image by: Steve Johnson

6. sequoia capital

About the venture capital firm

Sequoia is one of the oldest VC firms that are in the list. Donald T. Valentine founded this company in 1972. They deal with companies from the seed level and expansion level companies. Well, they are said to be one of the biggest VC firms in the world, and, rightly so, you will also understand why they are on the top after seeing their portfolio companies.

Into what industries do Yournest invest?

Sequoia invests in Fintech, Healthcare, Enterprises, B2B, Consumer, Saa S, Technology, and Mobile technology.

Well, we already know, sequoia VC firm started investing in 1972. So, the companies they invested in have become huge names by now. A few of the companies they invested in are; 1mg, Apna, Bharatpay, Byju’s, Cafe coffee day, Cardekho, Cred, Dailyhunt, Groww, Justdial, Meesho, Olacabs, Oyorooms, Urban ladder, and others

To know more about sequoia, go to www.sequoia.com.

7. Accel

About the venture capital firm

Accel is an American Venture capital firm. Jim Swartz and Arthur Patterson founded accel in the year 1983. Their headquarter is in California. Being such a big name they still work with companies from the seed stage to growth-stage companies. Diversity is the key here.

Into what industries does Accel invest?

Accel invests in companies throughout the different stages. They heavily invest in Media, Healthcare, Fintech, Consumer, Software, Security, Business products and services, and others

Among the companies Accel has invested in are; Meta (Formerly known as Facebook), Atlassian, Etsy, Slack, Dropbox, Flipkart, Jet.com, Webflow, Braintree, and others.

To know more about Accel, go to www.accel.com.

8. Tiger global management

About the venture capital firm

Chase Coleman III founded Tiger global in 2001, and they have their headquarters in Newyork city. Tiger Global invests in public and private companies. Although it may seem like they only invest in growth-level companies, they do invest in seed-level start-ups as well.

Into what industries do Tiger global invest?

Tiger global majorly invests in sectors like Consumer, Financial technologies, Internet, and software sectors.

Some of the companies Tiger Global invested in include; Alibaba, Clevertap, Glassdoor, Instacart, Linkedin, Quora, Spotify, Stripe, and others. I know, these are really big companies now, but they have reached here with the financial support from VC firms like Tiger global.

To know more about Tiger global, go to www.tigerglobal.com.

9. Matrix partners

About the venture capital firm

Matrix Partners is a California-based venture capital company in business since 1977. Paul Ferri is the founder of the company. They specialize in investing in US-based and India-based companies.

Into what industries do Matrix partners invest?

Being one of the oldest venture capital firms on our list, Metrix partners have invested in many companies till today. They invest heavily in Semiconductors, wireless sectors, Software, Communications, Data storage, the Internet, Edtech, Fintech, Healthcare, Media, Gaming, B2C, D2C, Travel, and other sectors.

Want to know some big names they invested in? Because I am going to tell you some of the companies Matrix partners invested in. Chumbak, Cloudnine, Creditvidya, county delight, Lime road, Oziva, Ola electric, Razor pay, Practo, Stanza Living, Zupee, and others.

To know more about Matrix partners, go to www.matrixpartners.com.

10. Y combinator

About the venture capital firm

Y Combinator is an American start-up accelerator company. As we know by now that the team running the firm is almost important in VC firms. So, here a team of four co-founded the company in 2005: Paul Graham, Jessica Livingston, Trevor Blackwell, and Robert Tappan Morris. The company is headquartered in California. Y combinator helps accelerate start-ups and gives them the support to reach their dream target.

Into what industries do Y combinator invest?

Y Combinator invests in a great variety of sectors twice a year. If you also fall under the variety of sectors Y combinators invest in then this can be your choice of VC firm. They invest in Software, AI, Services, Healthcare, Hospitality, Marketing, Media, Entertainment, Food, Fintech, and others.

As Y Combinator invests in various industries, its success rate is also very high. The Companies they have helped accelerate say about it all. Following are some of the companies that Y Combinator invested in, starting with Stripe, Airbnb, Opensea, Instacart, Giftlab, Cambly, Dropbox, and more. I am sure you must have heard about many of these companies.

If you are also thinking to chose them as your VC firm and want to know more about them, go to www.ycombinator.com.

So, our list of top 10 venture capital firms in India for the year 2021 comes to an end but, wait! I have some other important information for you on this topic which I feel can be of great use to you

How to choose the best venture capital firms?

Not sure about which venture capital firm to choose? Don’t worry, I have got you covered. Here is a small checklist that I have prepared on things to look for in a venture capital firm before choosing them.

Availability of those venture capital firms

Make sure that your venture capital firm is as involved in your business as you want them to be. Although you might not understand it first, trust me, sort out this topic first, as it can become a point of concern if you want them to be more involved and they do not take your project seriously. The best way to check this would be to check how many start-ups they currently support. Think about whether you want a less interested investor if they are already overburdened.

Networks of those venture capital firms

As a beginner in the business, one thing that you will need the most apart from funding from your venture capital firm is their connections. That is because connecting with other investment firms that can provide funds in the future is just as important as finding your current investor

Mastery of the People in the venture capital firms

Although this cannot be a deal-breaker, finding a venture capitalist who is knowledgeable in your industry can help you a lot. His experience with similar companies like yours can prevent you from possible future fallbacks.

Growth Plans of your and your venture capital firm

Even if your business is in the early stages, you will eventually want to expand. So, considering a VC who will succeed in filling future fund needs or helping you network with other VC firms is vital before selecting a VC.

Great! Now you are all set to make up your mind on selecting a Venture capital firm for your business. If you don’t own a business but just wanted some knowledge on a Venture capital firm, I hope you found this blog helpful. Let me and other readers know about any other venture capital firm you know. Also, suggest any other tips you know to select a VC.

10 most used terms in the venture capital space

While you are here to look for the top 10 venture capital firms in India, You might also like to be aware of some general terms used in the Venture capital space. The list below is of the 10 most commonly used terms in VC word, which any start-up owner or anyone interested in this field should be familiar with. So, let us continue with our blog’s theme and take a look at the top 10 VC terms.

1. Angel Investor

This term stands for those persons who are financially very strong and invests in start-up companies. Hence, the individuals who invest their own money into new businesses are called angel investors.

2. Bootstrapping

Bootstrapping stands for investing the company’s earned money into the company again for growth. Hence, very little or no money is collected from outside investors if a company is using a bootstrap model of investment for their company.

3. Cap table

A cap table is a short-term used capitalization table, which is a spreadsheet or a work data table. In that table, companies present their equity capitalization details. Cap table is used majorly by starting Entrepreneurs, and start-up owners but can also be used by companies in further stages as well.

4. Elevator Pitch

An elevator speech is a short speech given to your potential investors about your business idea. It should ideally finish very quickly. If you are not sure how short then you can take a hint from as small-time as an elevator takes to reach the destination floor.

5. Fully diluted company

 Fully diluted companies are those companies whose all the stocks are issues also, there is nothing left in the reserved pool.

6. Pre-money valuation

Pre-money in venture capital terms means those valuations which are made prior to any investment or funding received.

7. PEG Ratio

This ratio is for evaluating Price/Earning to growth numbers. The data points used in this ratio are the Company’s earnings per share, the price of a stock, and company growth expected in the future.

8. Portfolio company

 A portfolio company is a company that has a part of its equity owned by either VC firms, a Buyout firm, or Holding companies.

9. Roadshows

The presentations that new business owners or start-up founders do in multiple places/cities in front of their potential investors are known as roadshows. Usually, these series of presentations are done to collect funds from any of the investors.

10. Washout rounds

When the new investors in the company take full control of the company over the other equity holders. When a company goes bankrupt or is on the edge of shutting down, these washout rounds happen.

Summary

When it comes to choosing the right venture capital firm for the business, owners tend to get nervous and end up choosing the wrong VC for their business. This eventually burdens them mentally and creates additional stress on their shoulders. This is why taking enough time thinking about it and researching the different venture capital firms available for you is a smart thing to do. You need to understand your vision first and then look for VC who can suit your vision.

Other than just securing an investment, Being satisfied with the investment support is also a crucial part for a start-up owner because you may not know what help you will need in the future. Oh, and yes, don’t forget to use the checklist I made for you!

With this, we come to the end of our best venture capital firm discovery journey. I hope you found this blog useful, informative, and engaging.  

FAQs

What do venture capital firms do?

Venture capital firms help Seed level to growth-level companies with financial support by funding their businesses. They also provide counseling and networking support to their start-up owners.

What are the three important points to check before going to a Venture capitalist?

• VC firm’s background check
• Your industry and own business in-depth check.
• Data/reports to back up your research and statements.

Which companies benefit from venture capital funding?

Usually, companies that are in starting phase go to VC firms but, there is no limit to it. A company can go to a VC firm at any stage of its business.

At what stage should a business start looking for venture capital funds?

When you have an amazing idea about a business, when you can see the potential growth of your business and when you can back up your thoughts with some real-time data, then you can start looking for a Venture capital firm.

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