Accel Raises $650 Million for Its 8th India Fund After IPO Wins, Big Exits

Accel, one of the leading investment firms in the world, has raised $650 million (around Rs 5,500 crore) for its eighth India fund, according to the regulatory filings with the US Securities and Exchange Commission (SEC). This is not the first time the VC firm secured such a huge amount; the size of its seventh fund was also $650 million which was raised in March 2022. With this, its total investment commitment to India's start-up ecosystem will reach around $3 billion.

Its new fundraise comes at a time when Accel’s two portfolio companies --- Swiggy and Blackbuck (Zinka Logistics) --- went public on Dalal Street in 2024. Food and grocery delivery platform Swiggy launched its $1.35 billion IPO last November. However, the VC firm has recently exited Swiggy after tendering 10.5 million shares in the offer for sale (OFS). It has earned whopping a 35-fold returns on its investment in Swiggy.

Besides Swiggy and Blackbuck, Accel has also supported start-ups and unicorns like Urban Company and Flipkart. According to media reports, Accel, an early investor in e-commerce giant Flipkart, retained its 1.1 percent stake after US retail major Walmart acquired the company. But in 2023, the VC exited Flipkart after generating around $1.5-2 billion returns.

In addition, Accel has also invested in FirstClub (a start-up run by former Flipkart executive Ayyappan R), and Simplismart (an end-to-end machine learning operations platform for generative AI models).

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Accel’s latest fund closing comes at a time when VC firms are sitting on billions in dry powder --- undeployed capital money. Apart from Accel, its peer A91 Partners will reportedly raise $700 million in its latest fund as investors double down on India, the world’s third-largest start-up ecosystem.

On the other hand, Peak XV Partners has cut down the size of its $2.85 billion fund by $465 million, around a 16 per cent decline in fund size, MoneyControl had earlier reported. Additionally, VC firm Stellaris Venture Partners, an early investor of Whatfix and Mamaearth, has closed its third $300 million fund. Despite fluctuations in fund sizes, India remained the third-highest recipient of funding after the United States and the United Kingdom.