DSG Consumer Partners closes $65 million third fund

DSG Consumer Partners has closed its third venture capital fund at $65 million, said two people aware of the matter, requesting anonymity

Mint reported on March 31st that it had marked the first close of the fund, then planned at $50 million, at $30 million.

DSG had raised its first venture capital fund of $24 million in 2012 and followed it up with a $50 million fund in 2017. It is known for making early bets on hotel chain start-up Oyo Rooms, point-of-sale (POS) services provider MSwipe and Raw Pressery cold-pressed juices. The third fund will invest in seed and Series A rounds of $500,000 to $2 million and will invest a maximum of 15% of the fund in any one company

In addition to the third fund, DSG is also raising its second add on fund- a fund dedicated to backing the best companies from its own portfolio, as they raise Series B rounds and beyond. Along with the third fund’s close, it has also marked the first close of its add-on fund at $35 million.

The Economic Times first reported the development.

DSG’s founder and managing director Deepak Shahdadpuri did not immediately respond to a mail seeking comment.

Funds such as DSG, focused on the consumer segment, have been raising money at an increasing pace, driven by the rise in new disruptive brands that are riding the Indian consumption growth story.

Mint reported on 21 May that at least three consumer-focused firms, DSG, A91 Partners and Fireside Ventures are raising funds. While A91, started by three former senior executives at Sequoia Capital, closed its $350 million funds in June, Fireside Ventures is currently raising a $100 million second fund.

These investors are betting on new fast-growing consumer brands that are tapping into rising disposable incomes and the country’s large population of millennials. India’s affluent consumers and households, which earn between 5 lakh and 20 lakh per annum, have contributed to 43% of the 110 lakh crore in annual consumption in the country in 2018, according to a February 2019 report by the Boston Consulting Group (BCG) along with the Retailers Association of India.

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