Avendus, a financial services firm, has started its third Future Leaders Fund, aiming to raise about ₹3,000 crore. They have the option to raise an additional ₹1,500 crore.
This new fund will focus on investing in large private companies. Avendus plans to make 10-12 investments, each between ₹200-300 crore. The sectors they are targeting include financial services, consumer products, digital and technology, healthcare, and manufacturing.
Ritesh Chandra, managing partner at Avendus Future Leaders Fund, said they aim to tap into the potential of late-stage private opportunities and work with existing financial sponsors. They want to support high-quality businesses with strong competitive advantages and a clear path to liquidity.
Investment Strategy
The fund will invest in both primary and secondary transactions. They will look for companies with strategic advantages, strong execution abilities, and dominant market positions. Avendus aims to provide periodic liquidity to investors through various exit options, including secondary exits and sales through public markets.
This approach is important as many investors struggle to get returns or exits after the pandemic led to overvalued investments.
Successful Exits
Some recent successful exits from Avendus’ first fund include Lenskart and the National Stock Exchange of India, both giving nearly 4x returns to investors within four years. The first fund has returned the entire investor capital ahead of schedule with good returns. The second fund has made 11 investments and plans to invest the remaining capital soon. It expects four of its portfolio companies to list on stock exchanges in the next 6-9 months.
Together, the first two funds have managed over ₹1,850 crore in assets. The Future Leaders Fund platform is supported by Indian and US family offices and domestic institutions. Some of its portfolio companies include Bikaji Foods, Ujjivan Small Finance Bank, Licious, FirstCry, Delhivery, and VerSe Innovation (Dailyhunt).
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