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IIFL Asset Management rolls out second seed fund

IIFL Asset Management Ltd has floated its second seed fund that seeks to raise $143 million (around Rs 985 crore), a spokesperson said.

The company is reaching out to existing and new investors across India and abroad for the fund.

The IIFL Seed Ventures Fund II will focus on companies across financial services, consumer, healthcare and technology segments mainly at the growth stage. "We will look to invest in companies which leverage on technology to create a competitive advantage," the spokesperson said.

Separately, a US Securities and Exchange Commission (SEC) filing showed that the fundraising will take more than a year.

IIFL's first seed fund, which was launched in 2015, made nine bets, according to VCCEdge, the research arm of Mosaic Digital.

"Fund I is fully deployed and has delivered stellar returns. It's currently valued at two times, with average holding period of less than two years," the spokesperson said.

The seed fund's portfolio firms include food delivery services firm Box8, conversational artificial intelligence (AI) startup Uniphore, digital lending platform NeoGrowth and online fashion marketplace Fynd.

IIFL Asset Management is part of IIFL Wealth Management, which in turn is part of the financial services company IIFL Group. 

Earlier this week, VCCircle reported that Sequoia Capital India has floated a separate seed fund.

This followed the launch of its startup accelerator and incubation programme called Surge to make early-stage investments earlier this year. 

The launch of the seed funds is good news for startups in India as deal volume has fallen from the highs of the boom year 2015 even as a bunch of domestic early-stage venture capital firms have emerged in the market. Investors, for their part, argue that 2015 was a one-off year and they have now become more selective in their investments now.