Cornerstone Ventures, a venture capital (VC) firm that invests in business-to-business (B2B) enterprise technology startups, plans to make 3-4 new investments within this fiscal from its recently launched fund II. These investments will be primarily in Series A and B-stage startups, particularly in the enterprise SaaS segment, with one or two investments in the late stage as well.
Along with SaaS startups, Cornerstone Ventures is bullish about generative AI (Gen AI), Web 3.0 and quantum computing across financial services, retail and consumer business enablers, logistics and distribution marketplaces, and healthcare. “We invest in next-generation enterprise technologies, especially innovations that are making larger enterprise technologies future-ready,” Abhishek Prasad, managing director, Cornerstone Ventures told Fe. The VC firm’s second fund with $200 million corpus was launched in April this year, to invest in 15-20 startups. With a 12-year lifecycle, the fund offers ticket sizes ranging from $5 million to $15 million.
Prasad said that the Indian SaaS ecosystem has matured significantly, especially post-pandemic, allowing VCs to invest at more attractive valuations. “Looking ahead, we foresee substantial consolidation in the SaaS market, with over 500 expected acquisitions as unicorns gear up for IPOs,” he said.
He added that futuristic innovations are usually vertical-focused and deliver either a direct top-line or bottom-line impact.
Talking about how Indian SaaS startups are now increasingly prioritising the Indian market over international markets, Prasad said, “The Indian market has matured rapidly over the past decade, transitioning from being merely a big market in terms of population to very a deep market in terms of Enterprise innovations. A major driver behind this shift is the improving infrastructure within India, investments in cloud computing, data centres, and broadband connectivity”.
Launched in 2018, the firm’s first fund backed 21 companies, primarily in Series A and B funding rounds. The firm’s portfolio today includes Sharp Cell, End Paradigm, and Credit Nirvana, as well as SaaS marketplace models like Bluebch and Lio.