Avatar Intends To Back B2B, SaaS Startups, Launches New Fund


Former executives from Norwest Venture Partners and Freshworks have launched Avataar Venture Partners, a new venture capital fund with a target corpus of $350 million (approximately 2,800 crore). The fund intends to invest in 12-15 growth-stage startups that operate on business-to-business (B2B) and software-as-a-service (SaaS) models.

Mohan Kumar, Founder and Managing Partner, Avataar, said, “The new fund’s size may bump up to $400 million. The investment cheque size will range between $15 million and $50 million. We have already closed one deal with this new fund, which was $15 million. Two more investments are in pipelines,”

With an average ticket size of $35 million, Bengaluru-based Avataar intends to support up to 15 companies from Series B to D stages over a seven-year period through the new fund.

Kumar stated that the investment will be split 60-70 percent in SaaS and 20-25 percent in B2B marketplaces across the healthtech, agritech, and deeptech sectors. He also stated that Avataar is not enthusiastic about investing in the business-to-consumer (B2C) space. It announced the final close of its $100 million Opportunities Fund in February of last year for top-up investments in select portfolio firms as well as new investments.

Large institutional limited partners (LP) from Europe and the United States have contributed to the fund. It follows Avataar’s $300 million debut fund, announced in September 2019, with Boston-based fund of funds Harbourvest as its sole LP.

Its first fund invested in ten startups, including wellness and fitness SaaS unicorn Zenoti, media and fast SaaS firm Amagi, travel and hospitality SaaS firm RateGain, B2B rural commerce platform ElasticRun, and BFSI SaaS CRMNext.

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