Airavat Capital's USD 40 Million Global Tech Fund Aims to Back Deeptech and SaaS Companies The global technology fund, which will operate out of GIFT City (Gujarat International Finance Tec-City), is targeting only listed companies and will generally hold 15-20 companies at any given time.
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On Tuesday, the public equity investment firm Airavat Capital, which specialises in companies that employ technology, announced the launch of a USD 40 million Airavat Global Technology Fund R (AGTF R). A wide variety of investors, including current Airavat stakeholders, VC investors, technology founders/CTOs, and family offices, have expressed interest in the fund.
Sanjeev Bikhchandani and Hitesh Oberoi from Info Edge, Abhay Pandey and VT Bharadwaj from A91 Partners, Shray Chandra from Capitalmind, Jitendra Gupta from Jupiter Money (formerly Citrus Pay), Pankaj Chadda from Shyft (formerly Zomato), Sidu Ponnappa from Gojek, Tanay Tayal from Moonfrog, among many others, are a few of them.
What are the new fund targets?
According to Rohit Bhat and Suraj Subramaniam, Managing Partners at Airavat Capital, "The global tech fund is targeting only listed companies and will generally hold 15-20 companies at any point of time."
As technology investors in India over the past 10 years, Airavat has consistently come across global investment ideas that originated from the viewpoint of local Indian technology talent and developers. India is well-equipped with the expertise and experience required to assess global companies, especially in deep technology and software as a service (SaaS). In order to provide a means for affluent Indian capital to profit from these viewpoints, Airavat seeks to harness these perspectives from the employees, developers, competitors, and customers of these global companies based in India.
"The goal is to invest in global companies excluding India. Over time, we anticipate making investments in software, consumer technology, and other emerging technologies," stated Bhat and Subramaniam.
They claim that the fund will often seek out businesses that have robust unit economics, extensive runways, and leadership in long-term growth stories. For instance, they claimed, "As a start, we have invested in leaders in cybersecurity and devops, which typically have solid economics."
"When the financial winter initially began, we believed that the public market had overcorrected in comparison to the fundamentals of many technological leaders. These businesses, especially those in SaaS, are resilient to economic downturns. Because investment is still scarce, market share will be taken from startups that were utilising their funds to grow by well-established public companies that do not need to raise money." Bhat and Subramaniam emphasised that they believe this is a good moment to invest in publicly traded technology companies.
What's in the pipeline?
Airavat Capital is launching GTF NR, a sister fund of AGTF R, with the goal of attracting capital from investors in Southeast Asia (SEA) and the Middle East (ME), while AGTF R serves Indian pools of capital. Family offices and HNIs in the SEA and ME areas reportedly have shown strong interest in GTF NR. According to Airavat, the introduction of GTF NR will strengthen GIFT City's position as a developing international investing hub and open the door for future investors to benefit from the supportive rules.
With the launch of its global tech fund, the firm seeks to expand this technology-focused investing practice onto a global canvas and envisions crossing USD 100 million in assets under management (AUM) over the next year.
The fund will operate from GIFT City. Airavat also recently redomiciled a Foreign Portfolio Investment (FPI) vehicle to India with the launch of Airavat Capital India Fund (ACIF) in GIFT city, becoming amongst the first fund managers to migrate under the recent regulatory framework for off-market transfer of securities. ACIF pools capital from offshore investors to invest in India.
"With the launch and migration of our funds to GIFT City, we think we are at the beginning of a tectonic shift in the Indian investment landscape," said Bhat and Subramaniam.
Trilegal acted as legal advisors and PWC as tax advisors to Airavat in setting up the funds. HDFC Bank Limited is the designated depository participant and custodian to Airavat Capital India Fund and facilitated the relocation of the FPI to GIFT City. MITCON Credentia is the trustee and Kfin Technologies Limited is the fund administrator of Airavat's funds in GIFT City.
