Indian SaaS Startups Receive $85M Funding Boost

A New Venture Fund for Indian SaaS Startups

A collective of four prominent Indian entrepreneurs, instrumental in the initial growth of India’s SaaS sector, are embarking on a new phase of investment. These individuals have a proven track record of building successful startups, assisting them in scaling operations, and securing global customers. They have also previously invested in approximately 100 similar companies.

Introducing Together Fund

Girish Mathrubootham of Freshworks, Manav Garg of Eka Corporation, Shubham Gupta (formerly of Matrix investment firm), and Avinash Raghava (previously with Nasscom, iSPIRT, and SaaSBOOMi) announced on Wednesday the formation of a venture capital fund named Together Fund. The fund begins with a corpus of $85 million, dedicated to supporting emerging Indian startups within the software-as-a-service domain.

Investment Strategy

Together Fund intends to invest in between 20 and 25 startups, focusing on companies in the pre-seed to Series B funding stages. According to Manav Garg, in an interview with TechCrunch, individual investments will range from $250,000 to $3 million.

Early Reports and Network Strength

The formation of the fund was initially reported earlier this year by The CapTable, an Indian news source. An investor quoted in the report suggested that Together Fund is poised to attract high-quality SaaS deals due to the strength and experience of its founding team and its clearly defined investment focus.

A Powerful Ecosystem

The fund has already cultivated a network encompassing over 150 startup founders and investors. This includes notable figures such as Krish Subramanian of Chargebee, Nishith Rastogi of Locus, Shashank ND of Practo, and Kunal Shah of CRED. This extensive network was a key driver in the fund’s creation, as highlighted by Garg.

Operator-Led Approach

The team is comprised of founders and experienced operators who have successfully built startups and possess deep expertise in areas like sales strategy and international expansion. “This represents India’s first fund led by operators and founders,” Garg stated. “Our aim is to provide founders with not only capital, but also substantial support and opportunities.”

Timing and Market Conditions

The launch of Together Fund, which includes its founding team as Limited Partners (LPs), coincides with a period of record capital inflows into Indian startups. Many prominent investors are increasing their commitment to India, the world’s second-largest internet market.

Evolution of the Indian Startup Landscape

Over the last decade, the Indian startup ecosystem has undergone a significant transformation. It has evolved from a sector viewed with skepticism by many Indian families to one characterized by successful exits and a growing number of entrepreneurs launching second ventures.

A Founder’s Perspective

Girish Mathrubootham shared his personal journey in a blog post, stating, “Freshworks has grown into a substantial company with over 3,800 employees and global offices. However, eleven years ago, we were a team of just six operating from a small garage in Chennai. I lacked a prestigious resume or family wealth, but that didn’t deter me from pursuing ambitious goals.”

Paying it Forward

Mathrubootham continued, “For me, Together is more than just a fund; it’s a way to give back to the startup community that has given me so much. It’s a natural extension of our ‘pay it forward’ initiatives, such as PNGrowth, SaaSx, and SaaSBOOMi. With Together, we’re offering founders not only financial resources, but also our time and guidance.”

Continued Industry Involvement

The founding team of Together Fund will maintain their involvement in other industry initiatives, including SaaSBOOMi, the annual flagship conference dedicated to SaaS startups in India, according to Avinash Raghava.

Future Growth Potential

A recent study conducted by SaaSBoomi, McKinsey, and Nasscom projects that India’s SaaS industry could reach a value of $1 trillion and generate approximately 500,000 new jobs by the year 2030.