Venture capital firm Cornerstone Ventures, which focuses on SaaS (software as a services) startups, on Wednesday announced the first close of its $200 million second fund. The first close of $40 million involves commitments from domestic LPs (limited partners) including family offices, high net-worth individuals (HNIs), corporates and others, the firm said without disclosing their names.
The ticket size from the new fund would range from $5 million to $15 million for around 15-20 deals in multiple sectors including financial services and insurance, retail, consumer goods and ecommerce, distribution and supply chain, and healthcare products and services.
The company also announced the onboarding of Suresh Pareek, Founder at pharma company Ideal Cures as the General Partner.
According to the company, enterprise SaaS companies such as Zoom, Salesforce, Shopify, Twilio, etc., have delivered over 800 per cent in total returns at an annualized IRR of over 65 per cent in the past five years. The companies have also out-performed the well-known internet consumer companies like FANG (Facebook, Amazon, Netflix & Google), which have delivered about 300 per cent return in the same duration, Cornerstone Ventures said on its website.
“We believe Enterprise SaaS will continue to post consistently high double-digit growth for years to come, by creating new markets and garnering market share from traditional technology companies.”
Currently, Cornerstone’s portfolio includes Credilio, Blubirch, Credit Nirvana, Dopplr, Flinfo, Intelligence Node, Manage Artworks, and others.
As per Tracxn data, SaaS sector in India comprises over 22,000 companies, including 2.76K funded companies having collectively raised $25.6 billion in venture capital and private equity. Out of these, 747 are Series A+ funded, and 28 have achieved unicorn status. Moreover, the sector has seen 377 acquisitions and 28 IPOs so far.
In 2024, SaaS startups raised $1.54 billion in comparison to $1.2 billion in 2023, declining from $5.53 billion in 2022 and $6.6 billion in 2021, as per Tracxn.