Nexus Ventures Divides $700M Fund, Focusing Half on India Startups and AI

Nexus Venture Partners: A Balanced Approach to Investing in AI and India-Focused Startups

In today’s venture capital landscape dominated by AI investments, Nexus Venture Partners stands out with its deliberate focus on both AI startups and India-focused ventures. The firm recently announced a new $700 million fund dedicated to backing innovative companies in these two areas.

While recognizing the significant impact of AI on technology, Nexus Venture Partners believes in diversifying its portfolio to mitigate risks associated with investing solely in one overheated sector. The firm sees immense potential in India’s digital economy, where AI adoption is on the rise, and opportunities are abundant across consumer, fintech, and digital infrastructure sectors.

Founded in 2006, Nexus Venture Partners operates as a single fund with an integrated U.S.–India team, reflecting its commitment to cross-border investments. The firm has a track record of supporting early-stage software startups and India-focused companies from the same pool of capital. Its portfolio includes a diverse range of companies, from AI agents to consumer, fintech, and logistics startups.

Jishnu Bhattacharjee, a managing partner at Nexus Venture Partners, emphasized the firm’s strategic focus on AI as a major technological shift. However, he also highlighted the importance of using AI innovations to benefit the masses effectively.

With $3.2 billion in capital across its funds, Nexus Venture Partners has invested in over 130 companies and achieved more than 30 successful exits, including several IPOs. The firm’s long-horizon approach and focus on early-stage investments underscore its commitment to nurturing startups from inception to seed and Series A stages.

Abhishek Sharma, another managing partner at Nexus Venture Partners, highlighted the firm’s preference for early-stage investments, often starting with small checks of a few hundred thousand dollars. Nexus Venture Partners operates with an eight-member investment team and has maintained a fund size of $700 million since 2023.

Bhattacharjee explained that the decision to keep the fund size consistent reflects the firm’s belief in the optimal amount for its early-stage investment strategy, avoiding raising capital for the sake of it.

Despite India’s AI landscape lagging behind the U.S. in some areas, Nexus Venture Partners sees opportunities for the country to leapfrog in AI development. The firm cited India’s vast talent pool, growing digital infrastructure, and demand for localized AI models as key drivers of innovation in the region.

Companies like Zepto and Neysa, backed by Nexus Venture Partners, exemplify the evolution of AI in India. Zepto, a quick-commerce platform, leverages AI across its operations to enhance customer experience and operational efficiency, showcasing the integration of AI in consumer businesses. Additionally, infrastructure players like Neysa are addressing India-specific needs, such as sovereign AI workloads and support for multiple languages.

Nexus Venture Partners, with a diverse base of limited partners spanning across regions, has been able to fill its funds largely from returning investors, reflecting the firm’s strong track record of delivering returns. The firm’s commitment to early-stage investments and its emphasis on strategic partnerships have solidified its position in the venture capital landscape.

In conclusion, Nexus Venture Partners’ dual focus on AI and India-focused startups, coupled with its long-term investment approach, positions the firm as a key player in fostering innovation and growth in the tech ecosystem.

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