I have some great news to kick off this month’s newsletter — we’ve officially completed the First Close of Capria India Fund III.

I am happy to report that approximately 70% of the investors in this close are returning LPs — a clear vote of confidence in our investment thesis and execution track record. Conversations with several others are progressing well. 

Amidst global uncertainty, Indian early-stage venture capital offers something both rare and compelling — structural growth supported by technological transformation. If you’re curious to know how we’re thinking about the global macro environment — including tariffs, geopolitics, and trade — don’t miss the following analysis from Ankur Dubey, Principal at Capria Ventures.

Our new Pre-Series A Investment from Capria India Fund III:

Magma, a one-stop procurement and sustainability platform for SME manufacturers, enabling supply chain efficiency, clean energy adoption, and waste management. Watch this CNBC interview with Magma’s 25 year old founder, Neal Thakker. A quote from Neal: “A lot has been said about India+1 and the manufacturing shift to Indian factories, but nobody has asked if these factories are ready. That’s precisely what Magma is about – getting these factories ready.”

Introducing Our Barbell Strategy

One of the concerns investors have with VC funds is the long wait for liquidity — many funds return capital only in the 9th or 10th year of a 10-year cycle.

To address this, Capria India Fund III will follow a barbell-style investment strategy.

Over the past 12 years, we’ve built stakes in several high-potential startups. Many of these have matured and are now approaching liquidity events. We plan to allocate up to 25% of Fund III’s investable capital to double down on these breakout companies, creating the potential for high IRR returns within the next three to five years.

The remaining 75% will be deployed in new early-stage opportunities aligned with our “Future of Work” thesis. These will take longer to mature but are expected to generate outsized returns over time.

The result is a return curve that spikes early in the fund’s lifecycle, and again later in the term. If you were to graph it, it would resemble a barbell: weighted on both ends, delivering the best of both worlds.

To illustrate this strategy, here is an upcoming investment from our earlier portfolio:

• Masai – India’s leading outcome-based online coding bootcamp. 

We invested in Masai from India Fund II and then India Opportunity Fund I. Masai continues to go from strength to strength. They recently received a Series C term sheet from a strategic investor. Capria India Fund III will invest in this round as well, and we are confident of an exit within the next three to five years; illustrating the barbell strategy.

We have a solid pipeline of companies that fit our thesis and are growing quickly. Riding on common tailwinds for the Indian economy, we look for businesses solving for critical problems, with demonstrated traction, leveraging AI and led by founders with a depth of experience. We are particularly excited about evaluating SME manufacturing solutions, AI-led hiring solutions, AI-enhanced B2B SaaS products and marketplaces. 

If you are in Bangalore and want to learn more about our investment thesis or any of our portfolio companies, I’d love to catch up over coffee. We can also speak virtually, reply to this email and we’ll set it up. 

You can find my previous notes here.