Early Partners of Fearless Founders With Audacious Goals The early-stage, technology-focused, sector-agnostic investment firm Stellaris Venture Partners is optimistic about founders who are persistent and committed to tackling significant challenges in India.
This story appears in the July 2023 issue of BIZ Experiences India. Subscribe »
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Bengaluru-based VC firm Stellaris Venture Partners is focused on making investments in large, technologically disruptible sectors. Rahul Chowdhri, Partner at Stellaris Venture Partners, stated that "in that context, we are actively looking at backing founders building companies in SaaS, infra/dev tools, fintech, commerce, climate, brands, gaming, education, health, and agri sector."
The early-stage, technology-focused, sector-agnostic investment firm is optimistic about founders who are persistent and committed to tackling significant challenges in India. "The ecosystem has enough dry powder to support such startups. However, the more experienced investors will keep pressing for more information. In addition to growth, they will search for businesses that use capital effectively and build with an eye towards unit economics," said Chowdhri.
Chowdhri predicts that late-stage finance will remain challenging. This is a result of both their short exit duration and the discrepancy between founders' and investors' expectations regarding valuation. Late-stage investors will maintain their caution due to the lack of clarity surrounding the near-term exit windows. Second, the majority of late-stage businesses raised their previous round at exorbitant values that will be challenging to defend.
"Our plan is to maintain our current pace of 9–10 investments annually. We invested systematically, and we kept up this pace through 2021. On the other hand, we have always sought out founders who are driven to find solutions to customers' problems, have the appropriate profit structure, and are prepared to accelerate once the PMF (product market fit) is evident. In that regard, we do not anticipate a change in the types of businesses we will support this year.
"We advise all BIZ Experiencess to avoid running out of money until there is more clarity regarding the sentiment towards late-stage funding," Chowdhri stated.
As a fund, Stellaris consistently maintains a sizable reserve for its current investments. The company may need to use some of these reserves to support good companies.
"We are incredibly fortunate that the majority of our portfolio is exceptionally well capitalised," emphasised Chowdhri.
The venture capital firm claims to closely collaborate with the founders of its portfolio firms to plan their runway and burn. The majority of the companies it engages with place a heavy emphasis on two costs: marketing and human resources.
"Our proactive approach involves working closely with our portfolio companies to diligently strategize and prepare for these crucial areas well in advance, ensuring they are well-equipped to navigate potential challenges effectively," said Chowdhri.
Stats:
No of Startups Invested in: 37 since inception including 3 in FY23
No of Exits: 11 since inception
Focus Sectors: SaaS, Dev/Infra, Fintech, Commerce, Consumer Tech, Creator Economy, Climatetech, EVs, Agritech, Education, Healthtech
Fund Size: Investing from 2nd fund (USD 225 million), 1st fund raised in 2018 (USD 90 million)
Ticket Size: USD 250,000 - USD 6 million
