Fund II has a corpus of Rs 1,000 crore, with a green shoe option of around Rs 875 crore.
“We will be closing Fund II in the next 45-60 days. The demand is so high that we have already exercised a large portion of the green shoe option,” Ishpreet Singh Gandhi, founder and managing partner at the venture debt firm, said.
Exercising the green shoe option allows a venture capital or private equity firm to raise capital over and above its original target corpus, especially when demand for the fund increases among investors.
“With equity funding getting stricter and with founders also realising how beneficial debt funds are and its wide use cases, we are seeing a lot of demand,” Gandhi told ET.
Founded in 2019, Stride Ventures has invested in more than 20 companies from its first fund. These include Pocket Aces, Sugar Cosmetics, Infra.Market, Zetwerk and Home Lane.
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Stride Ventures closed its maiden fund of Rs 350 crore in 2021.
Fund II was set up in May 2021. The company announced the first close of Fund II in August last year.
“We have around 30 companies already in Fund II and by the time we close it will be around 50. As the token size was small, most of the capital raised is disbursed and deployed,” Gandhi said.
The use case of debt funds has widened in India from working capital requirements to capex and inorganic acquisition funding, and Stride Ventures is looking to set up a separate fund for supply chain financing.
“We have come up with a new product that will focus entirely on supply chain financing. It will be under Stride’s ambit, and it is right now in stealth mode,” Gandhi said
Stride Ventures’ portfolio has startups and companies from different sectors like consumer, healthcare, and e-commerce.
“Consumer, healthcare and commerce cover 60% of our portfolio while fintech, edtech and agritech have several use cases, we are exploring that segment now and will add more companies,” Gandhi said.
Stride Ventures is adding around 5-6 new companies and closing $15-$20 million of fresh sanctions every month.
“Across the consumer segment, we have added MyGlamm, we are doubling down on Sugar Cosmetics. We are adding 4-5 new companies to the portfolio like the consumer robotics company, Miko and other e-commerce companies,” he said.
The venture debt firm is also actively looking to invest in more electric vehicle (EV) and EV-related companies.
“We are actively talking to EV startups for investment. I don’t think one or two instances will result in the future of how EVs will shape in India. We will embrace EVs. Battery manufacturer Lohum is already in Fund II, and we are looking to add 3-4 more,” Gandhi said.
Stride Ventures competes with funds such as Alteria Capital, Trifecta Capital and Blacksoil. A venture debt fund lends money to startups alongside equity investors. Venture funds usually invest in late and growth-stage companies.
