Mumbai-based Artha Group’s venture arm, Artha India Ventures (AIV), has announced the first close of its second early-stage micro venture capital fund at ₹250 crore. The new fund, Artha Venture Fund II (AVF II), is targeting a total corpus of ₹500 crore, with an additional ₹100 crore green-shoe option.
Currently, AIV’s total assets undermanagement exceed ₹1,500 crore. The fund will back 36 seed-stage startups across premium consumption, fintech infrastructure, applied AI, and deep tech. It plans to deploy initial cheques of ₹4 crore and participate in follow-on rounds with investments of ₹8–16 crore.
Like many early-stage VC funds, AVF II is targeting 15–20% ownership in its top portfolio companies and will operate on a four-year deployment cycle. “AVF II is launching at a time when the startup ecosystem is undergoing a reset,” said Anirudh Damani, managing partner at Artha Venture Fund. He added that “in the last eight months, barring one, India has recorded fewer than 100 seed investments per month — the lowest in nearly a decade”.
The graduation rate from Seed to Series A has also declined sharply. “Historically, 1 in 9 startups — around 12–13% — would raise Series A within 36 months. That rate has now dropped to as low as 5–6% in recent months. That tells you how capital-starved the early-stage investment ecosystem has become,” he said.
AIV currently manages four funds, each designed with distinct venture strategies. Its flagship Artha Venture Fund I, closed in 2021 with a corpus of ₹225 crore, has backed startups such as Agnikul Cosmos, Everest Fleet, and LenDenClub. Artha Select Fund, launched in 2023, selectively doubles down on winners from AVF I, while Artha Continuum Fund (ACF) operates on a deal-by-deal model, offering curated opportunities primarily to family offices.
The first close of AVF II saw 90% participation from Indian limited partners — including family offices and exited founders — with the remaining 10% from global investors. Early backers include Shahi Group, DSP Family Office, Narendra Karnawat of Glance Finance, and several successful founders from Artha’s existing portfolio.
Damani added that the current environment rewards capital-efficient entrepreneurs. “The tourist founders are gone. What’s left are serious entrepreneurs building sustainable businesses.” AIV, the single-family office of Ashok Kumar Damani, now manages investments across 135 startups and 34 exits in India and abroad, including OYO Rooms, Rapido, and Purplle.