Venture Capital Shifts: Increasing Exits, Importance of Track Records, and the Rise of Solo General Partners
In the ever-evolving world of venture capital, a trend is emerging in India that sees senior general partners (GPs) leaving established firms to launch independent firms. This shift is driven by market dynamics, growth ceiling concerns, and changing preferences among limited partners (LPs).
One of the pioneers leading this change is Shailesh Lakhani, formerly Managing Director at Peak XV Partners (previously Sequoia Capital India). Lakhani is setting up an early-stage fund, aiming to stay nimble, founder-first, and back companies early while supporting them all the way through scale. Lakhani may be joined by Harshjit Sethi, another former Peak XV MD who recently stepped down.
Sameer Brij Verma, previously at Nexus Venture Partners, has already raised about USD 150 million for his solo GP vehicle, Northpoint Capital. Verma's vision for Northpoint Capital mirrors the trend, focusing on early-stage investments and providing continuous support to companies as they scale.
The rise of specialist and niche funds is another reason for this breakaway trend. As markets mature, value lies in focusing on sectors, stages, or themes that may be underserved by large generalist funds. This focus allows for more control over thesis, portfolio, pace, and structure, and is designed for sharper focus, faster cycles, and stronger relationships with founders.
Vaibhav Domkundwar of Better Capital notes that solo GPs can move faster without layers of committees, and have higher conviction levels because they are personally accountable for every decision. This personal accountability can lead to more effective decision-making and faster execution, which is particularly beneficial in the early stages of a startup's growth.
Shekhar Kirani of Accel India believes the next wave of VC in India will come from emerging managers who are closer to founders and sectors, and from smaller funds with a sharper focus and deeper conviction. This trend is evident in the success of funds like Northpoint Capital and Kenro Capital, launched by Piyush Gupta, which focuses on secondaries.
Gupta noted that 'secondaries are becoming an essential piece of India's venture ecosystem,' and Kenro Capital aims to provide liquidity to founders, employees, and early investors, while also creating fresh opportunities for LPs. This focus on secondaries is a testament to the maturing Indian venture capital market, where the need for liquidity solutions is increasingly important.
As this trend continues, it is clear that the solo GP model is becoming an attractive option for experienced venture capitalists in India. With their deep industry knowledge, personal conviction, and ability to move quickly, these solo GPs are well-positioned to drive innovation and growth in the Indian startup ecosystem.
Read also:
- Electric-powered vessels take to the waters of Maine
- Elon Musk accused by Sam Altman of exploiting X for personal gain
- Comparing the value of top electric scooters: Kinetic DX versus Bajaj Chetak versus TVS iQube - Which one offers the best bang for the buck?
- American Eagle's risque promotional effort featuring Sydney Sweeney leads to the brand being categorized as a 'trendy stock' among teenagers.
