This is more than twice the size of its previous fund launched in 2017 with a corpus of Rs 350 crore.
Alpha Fund will deploy the capital in sectors including cleantech and environment, health tech, agritech, edtech, fintech, and emerging sectors like web3, space-tech, among others.
IAN plans to invest the money over eight years.
IAN has followed a strategy of investing in companies that are raising up to Rs 6 crore, and leading the round with Rs 1-2 crore.
This strategy helps IAN get a foothold in high-quality deal flow, Padmaja Ruparel, founding partner of IAN Fund, told ET.
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Alpha Fund’s investment team includes Saurabh Srivastava, cofounder of IAN and former chairman of Nasscom; Ajai Chowdhry, co-founder of HCL; UB Pravin Rao, former chief operating officer of Infosys, among others.
Ruparel said mentorship for early-stage startups was among its key differentiators.
“When companies are at an early stage, mentoring is really important and it is not just the money,” she said.
The fund will focus on unit economics from an early stage, she added.
Fund 1 had invested in more than 200 startups, with three unicorns – Spinny, Druva and Uniphore.
Ruparel said the fund would carry forward its “risk-mitigating” strategy from the previous fund.
“The way we invest is a very risk mitigating strategy as it will be different stages, different sectors, different geographies, different business models, and companies working on intellectual property (IP) that creates long-term value,” she said.
Vinod Keni, managing partner, IAN Alpha Fund said the fund would also focus on startups from non-metro cities
“For us, the idea is to support the ventures, not only from tier I cities but even from tier 2 and 3 areas that are solving real-world problems at large,” he said. “We are eyeing startups that are scaling quickly with technology as their core foundation.”
