Foundation Private Equity has made its first significant investment in the Indian venture capital sector.
The Singapore-based secondaries buyer, acquired by Tikehau Capital in July, bought all of the LP interests in Prime Venture Partners I, a 2012-vintage, early-stage venture capital fund, according to a statement. The life of the fund was also extended by four years.
Fund I has exposure to seven companies, the jewel in the crown being Bengaluru-headquartered ed-tech business Quizziz, which had more than 65 million active users as of December 2020, according to its website.
“A lot of the opportunities that we see, especially in seed or Series A, funds have made 25 investments and you’d be lucky to see two or three that are still standing after nine years,” said Foundation partner and co-founder Jeremy Foo. “In this there are seven assets in the portfolio and we expect all seven to deliver healthy returns and good growth.”
Foundation opted for a tender offer because the fund was performing well and there was no need to reset economics, he added. The deal was sub-$50 million in size.
“We wanted a partner who supported the journey and saw the companies for what they are, rather than numbers, and will help us support the founders along the way without rejigging too much,” said Prime managing partner Sanjay Swamy.
Prime Ventures I raised $8 million, according to PEI data. The 2021-vintage Prime Ventures IV has so far raised $75 million of a $100 million target.
Ex-Navis Capital executive Foo formed Foundation in 2017 alongside Jason Sambanju, the former Asia secondaries head with Deutsche Bank. The firm mainly targets GP-led deals in China, India and Southeast Asia.
Speaking to Secondaries Investor in September, Sambanju described the perfect deal for Foundation as involving five to eight assets set to reach maturity over the next three to four years.
“[It would be] a portfolio that we can diligence, because there are some portfolios that you just can’t,” he added. “We need to be able to be on the ground, to meet with the companies and do the same with the GP. Almost always we prefer to be in the lead position.”
Article updated to reflect size of the deal