Mumbai
A senior executive said the Growx Ventures Fund (Growx Ventures Fund) of a B2B-focused Venture Capital company partially withdraws from its stake in space technology startup Pixxel at a 17-fold return. Existing investors, including Athera Venture Partners and Sparta, bought stakes in Growx’s secondary deal last month, the executive added.
“We have exited a portion of the Series B after we exited, with most of the shares being purchased by Athera and Sparta and an undisclosed third investor. We will continue to hold more than 75% of Pixxel as we believe the company will grow rapidly in the coming years,” said Seppal Bahl, Sheetal Bahl of Growx Ventures Fund and Merak Ventures.
The transaction generated 17 times the investment capital (MOIC) and 68% internal rate of return (IRR) in 5 years. With that exit, GrowX will return approximately 15% of the fund to the limited partners. Venture capital firms have invested ₹Since 2019, Pixxel has multiple branches spread across 110 million.
Strategic positioning
This also marks the first liquidity activity of Growx Fund I, a $25 million ( ₹2018’s Rs 16.2 billion) early stage fund, which supports 17 B2B technology startups in the fields of DeepTech, Fintech, SaaS and HealthTech. Its portfolio includes companies such as Bellatrix Aerospace, Progcap, Zuddl, Advantageclub.ai, Cynlr, Lightspeed Photonics and 4basecare.
The development comes months after Pixxel raised about $24 million in December in December, such as M&G Catalyst and Glade Brook Capital Partners. Some of their other investors include Google, radical Ventures, Lightspeed, and more.
Bahl explained that the part exit was to balance the company’s future growth opportunities and the ability to demonstrate export capabilities. “We expect more exports throughout the year.” He added.
Barr’s partner Manu Rikhye added that the fund has begun scouting out opportunities to show some liquidity and hopes to participate in some other assets. “Pixxel’s part of the export is primarily in line with this strategy. This is an opportunity for Sequence B, pre-Sequence C to appear on us at an attractive price.”
Investor expectations
Broadly speaking, in the past 12-18 months, limited partners (investors of venture capital and private equity funds) have sought some liquidity, with several investors more actively exiting over the past 12-18 months. “While we believe in the long-term potential of Pixxel, we also want to prove to investors that this is a true multiple,” Rikhye said.
Barr added that many investors believe that the assets are only on paper because they don’t really see returns. “One of the biggest arguments between GLP and Indian funds is that while the paper returns look great, they don’t return the money, and that’s one of the reasons we’ve got a small stake from Pixxel,” he said..
Meanwhile, growx was used as an Angel Group Before launching the first fund in 2019, invest in early B2B startups in India by raising funds from friends and family. Some of Growx’s exits as an Angel Group include Locus Logistics (GIC), Quandl (Nasdaq), Adsparx (Discovery), Fortunepay (Ezetap) (Ezetap) and Fynd (Reliance Industries). Angel Group is a group of angel investors who gather to invest in a startup.
In 2022, Bahl and Rikhye founded Merak Ventures through the same investment paper. It should be clear that the two partners that previously managed the $25 million junior fund of Growx Ventures will continue to handle the operations of the fund only. The Growx brand is independent, and Rikhye and Bahl will play a role in any fund raised in the future.
Key Points
- Growx Ventures Fund partially exited its stake in space technology startup Pixxel, generating a 17x return on investment in investment capital and a 68% internal rate of return in five years.
- Despite partial exits, GrowX still holds over 75% of its Pixxel, showing confidence in the company’s future growth potential.
- The exit marks the first liquidity activity of GROGX Fund I, a $25 million early-stage fund that supports 17 B2B technology startups in areas such as DeepTech, Fintech, SaaS and HealthTech.
- Pixxel raised $24 million in the expanded Series B funding round, attracting new investors such as M&G Catalyst and Glade Brook Capital Partners.
- The exit highlights the shift in investment strategies among Indian venture capital firms as global investors increasingly demand returns rather than paper valuations.
