Funding Alert

Trifecta Capital Successfully Closes Oversubscribed Venture Debt Fund III at ₹1,777 Crore

• ByStartupStory     |    September 25, 2023

Trifecta Capital, a prominent Indian venture debt firm, has announced the successful final close of its third venture debt fund, aptly named ‘Trifecta Venture Debt Fund III.’ Notably, the fund surpassed its initial target of ₹1,500 crore, closing at ₹1,777 crore (approximately $213 million in USD terms).

Founded nine years ago by Rahul Khanna and Nilesh Kothari, Trifecta Capital has played a pivotal role in India’s startup ecosystem. The firm specializes in offering tailored financing solutions to startups across various sectors, including B2B, consumer services, e-commerce, fintech, cleantech, edtech, healthcare, and more. Venture debt, unlike traditional financing, caters to the unique requirements of startups, enabling them to access capital without diluting equity.

The successful closing of Trifecta Venture Debt Fund III is a significant milestone for the firm, with the fund initially having its first closing in November 2021. The fund will now have an investible corpus of up to ₹4,440 crore, including provisions for capital recycling.

Rahul Khanna, co-founder of Trifecta Capital, highlighted the fund’s credit quality, noting that 40% of the portfolio companies have raised follow-on equity financing within just 21 months since the first investment. Additionally, the investee companies have displayed robust median revenue growth rates exceeding 60% annually. Khanna also revealed a pipeline of near-term opportunities worth over INR 800 crore across a curated group of startups.

Trifecta Capital has already made significant investments in the Indian startup ecosystem, supporting more than 50 startups with a commitment of ₹1,500 crore. Notable beneficiaries include Zepto, The Good Glamm Group, Cashfree Payments, Udaan, and many others.

One of Trifecta Capital’s key strategies is its focus on growth-stage startups, providing capital during the Series B stage and beyond. The firm has successfully raised ₹5,000 crore across three venture debt funds and one growth equity fund. Its portfolio includes 21 unicorns and over 12 soonicorns, including prominent names like Big Basket, Pharmeasy, Vedantu, and ShareChat.

With the final close of its third venture debt fund, Trifecta Capital is poised for further expansion and impact. The firm anticipates the launch of its fourth venture debt fund in early 2024, reaffirming its commitment to being the preferred financial partner for India’s new economy businesses. Additionally, a second growth equity fund is on the horizon, building on the success of Trifecta Leaders Fund-I, which raised ₹1,500 crore to drive investments in growth-stage startups.

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