The fund has already made its first investment in a medical tourism startup, Balakrishnan told Mint in an exclusive interaction in Mumbai this week, without disclosing further details.
The investors include the Sidharth Birla, Kohli, GMR, and Parikh family offices, he said. The fund, part of the Kriscore Group, is targeting a total of ₹200 crore, including a greenshoe option of ₹100 crore.
After almost a decade at Lazard, Balakrishnan stepped down in 2013 to launch Kriscore Financial Advisors. Another decade later, alongside his sons Nilesh Balakrishnan, former associate vice president at WaterBridge Ventures, and Animesh Balakrishnan, former senior associate at 3one4 Capital, he is starting up again, this time as a venture capitalist.
“I’ve come back into full operational mode for a while, at least for the next six to 12 months, until things stabilise and the fund raises its targeted amount. After that, I’ll take a step back from the day-to-day, though my DNA will always remain part of the firm. Much of the leadership will transition to the next generation, with Nilesh taking the lead,” said Balakrishnan.
Balakrishnan started at DCM in 1984 and moved to Infrastructure Leasing & Financial Services Ltd during the early 90s. A chartered accountant-turned-banker, he led HSBC’s investment banking business during India’s PSU privatisation wave, after which he moved to re-establishing Lazard’s India operations in 2004.
Massive opportunity
Kriscore Capital, based in Mumbai, plans to invest in 16-18 startups with an entry cheque size of ₹3-5 crore each, and follow-on cheques of ₹8-12 crore each in eight or nine select portfolio companies.
The sector-agnostic fund will invest at the pre-seed and seed stages, with a bias for exceptional founders building on trends like digital consumer, China+1 supply chain opportunities, global export of India’s premium market, GenAI-powered services, and net zero emissions by 2070, said Nilesh Balakrishnan, general partner at Kriscore Capital.
“There’s a massive opportunity in the early-stage to create value on a deal-by-deal basis. If you’re running a large fund and coming in at Series C, it’s hard to be truly impactful. We want to ensure we’re not just offering capital, but also real support to our portfolio companies,” said Nilesh. “With a smaller fund size, you have a real shot at delivering outsized returns, 5x or 6x.”
In addition, the company will provide fundraising advisory, compliance, and exit strategy building services to early-stage startups.
Apart from the Balakrishnan family, Kriscore Capital includes Raghav Rao, a former banker from Lazard. The fund’s advisory board includes D Sundaram, vice chairman & managing director of TVS Capital Funds Ltd and lead independent director at Infosys, Shyam Srinivasan, senior advisor at TVS Capital Funds and former CEO of Federal Bank, and Manish Kheterpal, co-founder and partner at WaterBridge Ventures.
Vikram Chachra, founding partner of early-stage venture capital firm 8i Ventures, said there has been a widening capital gap in India’s seed funding landscape in recent years, which micro-VCs are well-positioned to fill.
Filling the gap
“Large funds have grown so big they rarely write cheques below $5 million anymore. That leaves a significant vacuum in the less than ₹20 crore range typical of seed rounds,” Chachra said. “Micro-VCs are stepping in to fill this gap with institutional capital at a time when new venture creation remains strong but early capital is scarce.”
There are over 100 micro-VCs, a majority of which were established during 2022 and 2023, which typically invest $100,000-$500,000 at the seed to pre-seed stages, according to a Blume Ventures report.
“These funds often invest at valuations ranging from $1 million to $8 million and take a 3-8% stake in the startup. The general partners leading these micro-VCs are former entrepreneurs, operators, or active angel investors, often bringing sector-focused expertise to the table,” Blume said in the report, published in January 2024.
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