ET had exclusively reported about the fund’s launch in August 2024. AJVC was set up at a time when a slew of micro venture capital firms, or smaller sector-focused funds, have been launching in India to back early-stage startups.
“We are seriously considering exercising the greenshoe option given the overwhelming interest in the fund,” Bhatnagar said.
The firm has backed nine pre-seed stage startups across sectors such as AI, business-to-business (B2B), consumer brands and consumer tech, he told ET, adding that AJVC has a standard investment strategy of backing pre-seed companies with a Rs 1.5-crore cheque for 9% stake in the startup.
The fund, which is primarily made up of domestic capital, counts Indian family offices, multiple founders of Indian tech unicorns and top executives at large investment firms as limited partners.
Bhatnagar said that the fund has received more than 5,500 applications “Our tech-driven systems and workflows allow us to respond to all our companies. Our turnaround time is publicly available due to a proprietary process and models we have created for our investments,” he said.
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He pointed out that risk capital investment activity being in the slow lane is also proving to be conducive with early-stage startups getting more reasonable valuations.“A lot of funds that started out in 2022 or 2023 are in negative territory (in terms of returns) right now because they invested at high valuations… I think for us the good thing has been that valuations have been reset to a very large extent,” Bhatnagar said. “The deals we’re seeing at our stage…they could have raised three-four times larger rounds two years ago given how much funds were deploying. We are very disciplined with valuations and we have standard cheques.”
As per Venture Intelligence, Indian early-stage startups raised $1.7 billion in 2024, marginally higher than $1.6 billion in 2023.
Bhatnagar said that out of the 5,500 startups that approached AJVC – fashioned after A Junior VC, a platform that he launched in 2018 to offer insights into the Indian startup and venture investing ecosystem – more than 1,300 were AI startups.
“The fact that it’s such a large volume of companies, it seems to be mimicking the general spread of companies in India at that stage. There are AI software companies, consumer brands, health, education, B2B, fintech, food tech, deeptech, media and logistics companies in this spread,” he said.
The nine companies backed by AJVC include startups from places such as Assam and Jharkhand.
“When we looked at data from tier-II cities, there was a slight bend towards business-to-consumer companies that were either brands or consumer tech,” Bhatnagar said.
