Sauce.vc, a venture capital firm known for backing prominent consumer brands like Mokobara, Whole Truth Foods, Supertails, and Bare Anatomy, has announced the launch of its third VC fund with a target corpus of INR 250 crore ($30 million).
Investment Focus and Fundraising Strategy
The New Delhi-based venture capital firm plans to invest in 15-16 early-stage consumer brands, concentrating on domestic limited partners, including family offices and corporate entities focused on the consumer sector. This strategic move aims to tap into the growing market of innovative consumer products and services in India.
Sauce.vc’s first fund, launched in 2019, had a target corpus of INR 60 crore, followed by a second fund in 2021 with a fund size of INR 158 crore. Most recently, Sauce.vc closed its Sauce Continuity Fund with a corpus of INR 263 crore. With the introduction of this third fund, Sauce.vc aims to build on its success by making more substantial investments from the primary fund itself.
Shifting Investment Strategies
Manu Chandra, founder and managing partner at Sauce.vc, shared insights on the firm’s evolving strategy. Moving away from the practice of raising continuity funds, Sauce.vc plans to make larger ticket size investments directly from the main fund. This shift indicates a strategic pivot towards consolidating resources for more impactful investments.
The firm has received in-principle approval from SEBI for the new fund, which will enable them to write cheques in the range of INR 3.5-4 crore, compared to the INR 2-2.5 crore deals made through their previous funds.
Building on a Strong Portfolio
Since its inception in 2019, Sauce.vc has invested in 30 companies, supporting new-age brands such as XYXX Innerwear, Innovist, Hocco ice cream, Kreo, Rockit, and Perfora. This diverse portfolio showcases Sauce.vc’s commitment to fostering innovative consumer brands that cater to evolving market demands.
Industry Context and Future Prospects
Sauce.vc’s latest fund launch coincides with a broader trend of venture capital firms rolling out new funds to support emerging startups. For instance, Mumbai-based VC firm IvyCap Ventures recently closed its third fund at INR 2,100 crore, targeting 25 early-stage startups. Similarly, in January, Equirus introduced a $25 million early-stage fund aimed at tech startups.
The launch of Sauce.vc’s third fund underscores the firm’s strategic focus on nurturing early-stage consumer brands and highlights the vibrant ecosystem of venture capital investment in India. By leveraging its robust network of domestic limited partners and concentrating on substantial investments, Sauce.vc is well-positioned to drive growth and innovation in the consumer sector.
