Fireside Ventures raises fund worth $118 million in final close

Early-stage investor Fireside Ventures, which focuses on consumer startups, has raised $118 million, marking the final close of its second fund, a top executive said on Wednesday.

Limited partners (LPs) or investors in Fireside Fund II include Investment Corporation of Dubai, Nippon India Digital Innovation AIF, Bajaj Holdings and Investment Ltd, ITC Ltd, L’oreal, Pidilite, Small Industries Development Bank of India (Sidbi), PremjiInvest among others.

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The three-year old investment firm had marked the first close of the new fund in November, 2019, and had received commitments of around $60 million. Since then, it invested in four companies - GynoVeda, Sarva Yoga, Fable Street and Slurrp Farm.

Fireside will invest in 15-20 consumer-facing start-ups while continuing to keep its focus on digital-first brands from the second fund.

“While the strategy continues to invest early on in a company, this is a larger fund and we will write slightly larger cheques. We will focus on the overall consumer spectrum but we are now seeing a lot more focus on wellness, nutrition and health as we come out of the pandemic-led crisis. That’s become an overarching theme,” Kanwaljit Singh, founder and managing partner, Fireside Ventures said in an interview.

Fireside Ventures closed 18 transactions from its first fund, with deal sizes ranging between $2-3 million each. From the second fund, size of deals will rise to $5-6 million.

The first fund was raised in 2018 and had closed at $50 million.

The covid-led crisis led to an obvious shift in consumer demand with accelerated online buying, and direct-to-consumer (D2C) and e-commerce becoming more mainstream.

Singh said while most of its investee companies are located in metros, startups in smaller cities are coming to the fore.

“In our portfolio, companies specifically catering to healthier food, nutrition, wellness, personal care performed positively last year. Those in fashion and accessories saw an initial slowdown but they are starting to recover and will go past their pre-covid numbers. A lot of credit goes to founders also for strategically launching products and services. There is a 3x jump in our (overall) portfolio revenue compared to pre-covid levels,” Singh added.

Fireside’s new fund close comes after its portfolio firm boAt, in which it has put in ₹21 crore so far, raised $100 million from Warburg Pincus earlier this month at a valuation of $300 million. Fireside made a partial exit with the transaction with good returns.