The firm said it remains cautious on pricing and continues to underwrite investments based on business fundamentals
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Series B-focused venture capital firm Fundamentum has launched its third fund with a target corpus of ₹2,200 crore, including a ₹400-crore greenshoe option, as it looks to back India’s next generation of technology start-ups across consumer technology, fintech and AI.The fund, anchored by co-founder Nandan Nilekani — who has made his largest commitment to any venture capital firm — will continue Fundamentum’s strategy of making concentrated bets on 8-10 early-growth start-ups. Initial cheque sizes will range between ₹100 crore and ₹150 crore, with the firm taking board seats and working closely with founders through the scaling journey.Founded in 2017 by Nilekani and Sanjeev Aggarwal, Fundamentum has backed companies including Spinny, PharmEasy, Kuku, AppsForBharat, Stable Money, FlexiLoans and ProcMart.While consumer technology and fintech will continue to dominate deployments, the firm expects artificial intelligence to emerge as a key investment theme.“We are likely to be about 80 per cent fintech and consumer in this fund. We will make about a couple of investments in AI-focused companies. Our first cheque tends to be about $10 million on average,” Prateek Jain, General Partner at Fundamentum, said.The firm believes India’s AI opportunity lies in building products that solve local challenges rather than competing in frontier AI models.“India is also going to be a factory for small language models. A lot of these unique India problems will be solved through these small language models which are designed for India,” Sanjeev Aggarwal, Co-founder and General Partner, said, citing use cases such as land records, financial services and other India-specific applications.Fundamentum also expects AI to make digital services more accessible to the country’s next wave of internet users, particularly across financial services, healthcare and education.The launch comes as India’s start-up funding environment has become more disciplined, with investors increasingly prioritising sustainable growth over aggressive valuation expansion. The firm said it remains cautious on pricing and continues to underwrite investments based on business fundamentals.“Our definition of product-market fit essentially starts with unit economics. If the unit economics is not figured out, we do not think that is product-market fit,” Mayank Kachhwaha, General Partner leading fintech investments, said, adding that the firm evaluates companies with a clear path to profitability even while backing high-growth businesses.Fundamentum also sees a more mature exit environment emerging for growth-stage investors. Besides IPOs, large private equity firms and global institutional investors are increasingly providing liquidity through secondary transactions, expanding exit avenues for venture capital funds.The investment firm has made 17 investments across its first two funds and said its pipeline for Fund III remains strong. It expects to announce its first investments after the initial close, with two to three deals likely before the end of the calendar year.Published on July 9, 2026
