Impact funds made headlines in an otherwise quiet week for private equity and venture capital (PE-VC) in India. In Edition #39 we explore ‘elephant startups’, and round up the smattering of deals that got done.
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Lead
Raising Elephants
In 2021, an American entrepreneur and impact investor, Luni Libes, proposed a new animal for the startup menagerie. Instead of unicorns or zebras, what the investing world needed, he argued, was elephants – companies that grow steadily, scale and have a big impact on their surroundings.
The idea sat in a corner of the impact investing world until July 2023 when Erica Wenger, general partner at New York-based venture capital firm Park Rangers Capital, published her ‘Elephants, Not Unicorns’ essay pitching the elephant as the defining company archetype for the next decade – community-driven and purpose-led, in contrast to the growth-at-all-costs unicorn.
Neither Libes nor Wenger was thinking specifically about India. But the metaphor was always going to land differently here — elephants are not abstract in this country.
Next Bharat Ventures CEO Vipul Nath Jindal made the connection explicit a year ago. “We don’t want to raise unicorns, we want to raise elephants. We want to build companies that move slowly but can surely reach their goal,” he told Nikkei Asia in an interview last year. Next Bharat Ventures, a 100% subsidiary of Suzuki Motor Corporation, was established in July 2024 with a specific mandate – back social entrepreneurs working towards improving livelihoods in rural India, tier 2 and tier 3 cities and the informal economy in larger cities. The first fund, with a $40 million corpus, backed over 20 companies.
This week, the Bangalore based firm announced the close of its second fund at $200 million. The fund is structured for 15 years instead of the standard 10. The goal is to “build 200 to 300 profitable elephants” over the fund’s life, it said in a statement.
The current portfolio offers a window into what that looks like in practice. Manikstu Agro provides vaccinated livestock to small and marginal farmers alongside veterinary care, market access, and ayurvedic animal health products. MuddleArt is the only formal player in pre-consumer textile waste management in India which integrates marginalised waste workers into a traceable, accountable system. Atypical Advantage is a livelihood platform for persons with disabilities.
Next Bharat Ventures’ close comes in an environment when fundraising in India is slower and more selective. Investors and fund managers are still putting capital to work, but with greater discipline on deployment timelines.
Staying with impact funds, Lok Capital’s fifth fund, which is targeting $250 million, received a $40 million commitment from World Bank arm IFC – $20 million as a direct commitment and up to $20 million as a co-investment envelope. Lok aims to back businesses in financial services, climate and sustainability from the new fund, which has been on the road since last year.
In the broader market, Nandan Nilekani’s The Fundamentum Partnership launched Fund III with a target corpus of Rs 2,200 crore ($230 million), including a Rs 400 crore greenshoe. Nilekani will anchor the fund as a limited partner, stepping back from his general partner role. The Infosys co-founder is also an anchor in Fundamentum Frontier Advisors, a spin-out launched in May by co-founder Ashish Kumar specifically for AI bets.
And NIIF, the sovereign-backed alternative investment firm, secured an AU$500 million ($347 million) commitment from Australian superannuation fund AustralianSuper, taking the latter’s total India exposure across asset classes to AU$3.3 billion ($2.3 billion). AustralianSuper had previously committed $250 million to NIIF’s first fund, with co-investment rights of up to $750 million.
The Week in Deals
Early Stage Startups Shore Up a Quiet Week
Over 14 companies raised capital this week, most of it at the early stages — seed, pre-seed and pre-Series A. Dealmaking overall has been slower over the past few weeks with the gap most prominent at the early-growth and growth stages. Dive into this week’s round-up.
Aseem Infrastructure Finance, incubated by India’s sovereign-anchored alternative asset manager NIIF, is being acquired by an investor consortium led by TPG. Singapore’s GIC and ICICI Bank are part of the consortium, which will pick up a 100% stake in the Mumbai-based debt financier creating an exit for NIIF.
ICICI Bank is slated to own a 5% stake. Further financial details were not disclosed. Media reports estimate the size of the deal at between Rs 4,800-Rs 5,000 crore ($500-$526 million).
NIIF owned a 59.05% stake in the company at the close of March 2026, according to regulatory disclosures. Japan’s SMBC owned 10% and the Government of India held 30.95%.
The company has disbursed loans worth over Rs 40,000 crore to date, including 27 GW of renewable energy projects, it said in a statement.
NIIF recently secured an additional $3.2 billion investment commitment from the Government of India and $347 from AustralianSuper, a returning investor, for its Fund II.
Iswarya Fertility Center raised a $36.7 million growth round from OrbiMed. The Chennai-based company has been providing IVF treatment services for three decades and operates over 80 fertility centres concentrated in the southern states. It also has a presence in Maharashtra and Kolkata. India’s declining fertility rates have become a concern lately while spelling growth opportunities for private sector players in the IVF and fertility treatment space.
Adage Automation raised Rs 230 crore ($24 million) in a growth round led by InCred Alternative Investments. Global South Capital and Prachetas Capital participated in the round. InCred contributed Rs 180 crore to the round. The Goa-based company designs and manufactures advanced industrial gas analyser systems for sectors such as oil and gas, cements, chemicals, power and energy.
Elevate Education (formerly known as Sunstone) raised a $17.7 million Series D from returning investor WestBridge Capital. The Gurugram-based company offers independent degree programmes, runs programmes for undergraduate and post-graduate education, and assists students with job placements.
Edtech deals have been sporadic for the past couple of years following the spectacular implosions of Byju’s and Unacademy. The latter is being acquired by rival upGrad (the CCI approval came in this week) for a reported Rs 2,055 crore (about $218 million), a 90% slide from its peak valuation.
Karamtara Engineering raised $7.8 million from Amara Partners in a pre-IPO round. The Mumbai-based company manufactures solar mounting structures and tracker components for the renewable energy sector. It filed draft documents for a Rs 1,750 crore initial public offering last year.
Sub $5 million deals: Sustainable packaging solutions company Econovus raised $4.2 million in a pre-Series A round led by Rainmatter. Physical AI company Mowito raised $3 million led by Version One Ventures. Dairy products company Doodhvale Farms raised $1 million from existing investor Atomic Capital. Skincare brand Neothera raised $0.9 million in a pre-seed round led by Blume Ventures. AI-led diagnostic technology startup eNLife Research raised $0.6 million in a seed round led by Piper Serica. Spacetech startup BAAS Technologies raised $0.5 million in a pre-seed round led by Inflection Point Ventures. Loyalty rewards platform Onpoint raised $0.6 million in a pre-seed round co-led by India Quotient (via its First Cheque platform) and Whiteboard Capital. AI-led customer research company Alchemic raised $0.2 million in a pre-seed round led by AJVC.
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Recco | Notes on Culture, Craft and the Considered Life
The Rainwater Gin
This week’s recommendation isn’t just a gin. It’s the company behind it. Cherrapunji Eastern Craft Gin is made by Meghalaya-based Raincheck Earth, which raised $1.2 million in funding last February. The idea behind the company is beautifully simple: if you’re going to make a gin in one of the wettest places on Earth, why not use rainwater?
That’s exactly what it does.
The rainwater is harvested, treated and used in the distillation process. Ironically, Cherrapunji, despite being among the rainiest places on the planet, faces water shortages every winter because most of its rain runs off the rocky terrain instead of being stored.
The gin itself is bright, citrusy and smoky, with botanicals sourced from across the Northeast, including Khasi mandarin, Kaji lemon, smoked tea, Himalayan juniper, black pepper and cardamom. There’s also Berry Blossom, a second, more recent expression that combines sweet-tart wild Sohiong berries, a black mountain fruit native to Meghalaya, with delicate pink cherry blossoms.
Raincheck Earth also recently picked up a prestigious Red Dot Design Award for its recyclable stainless-steel bottle, a clever alternative to the heavy glass bottles that dominate premium spirits. It is available in major metros, including Mumbai and Delhi.
The gin is excellent, and the story behind it is even better.
Recco is a column by Murali K Menon. Murali has spent a career paying close attention to how things are made, where they come from, and why some of them endure. Every edition, one recommendation: a maker, an object, a place, a practice.
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