Pavestone, a Hyderabad-based venture capital firm, has now closed its Pavestone Technology Fund. It has successfully raised a corpus of Rs 816 crore across the investor base, running above the original target corpus for the fund, which stood at Rs 600 crore.
This spurt in funds comes after Pavestone’s strategic use of the greenshoe option, which the firm used twice to fulfill enhanced investor interest. While the firm had initially targeted Rs 600 crore, the sheer demand prompted Pavestone to enhance the fund’s goal to Rs 900 crore, which eventually closed at a breathtaking Rs 816 crore.
Enterprise and frontier technologies
The Pavestone Technology Fund will invest primarily in early-stage B2B technology startups mainly across India. Plans are to support about 14 to 15 startups, and the firm expects investments average per startup to be in the range of $5 million to $10 million. The firm has a very sharp focus on those startups that are already showing well in the market and maintain valuable relationships with key private and public sector enterprise clients.
Pavestone’s investment strategy focuses on enterprise technology solutions – these solutions entail the tackling of deep challenges for large-scale B2B and encompass generative artificial intelligence, cloud computing, immersive technology, and bioengineering. The fund’s managing partner, V. Laxmikanth emphasized this mission by saying, “The core thesis of the fund is around enterprise technology that addresses public enterprise needs in the B2B space.” So, a good 80% of its capital allocation will be towards such enterprise-focused startups-the integral aim towards Pavestone’s purpose of enabling impact tech solutions.
The rest 20% will be invested in “moonshot” high-impact projects. Investments will be made in frontier technologies with a very high risk and thus highly rewarding approach by the fund in support of visionary projects that really “make things happen.”
Initial investments and strategic focus
Pavestone has already begun to make meaningful investments in various innovative startup categories. The portfolio comprises E42, a no-code artificial intelligence platform; Bellatrix Aerospace, an in-space propulsion company; LivNSense, industrial AI focused on decarbonization; NewSpace Research & Technologies, that treads within the defense-focused aerospace sector; and Cynlr, a developer of advanced visual robotics technology.
These early investments reflect the Pavestone focus on disruptive B2B technologies serving critical needs inside industrial sectors. Each of these companies is part of the fund’s strategy to invest in startups that combine advanced tech solutions with the capacity to make a high impact on large, scalable markets.
A Timeless Investment Philosophy
As Laxmikanth has put it, the investment philosophy of Pavestone is based on “timeless investment principles like rigorous analysis, risk management, and governance.” This policy underlines the commitment of the firm toward long-term value creation that would drive impactful innovation. That would require a market constantly evolving in response to technology.
Here’s one of the significant proactive approaches Pavestone has shown: identifying and developing early-stage startups focusing on frontier technologies. Pavestone appears to be truly committed to powering growth in the Indian tech ecosystem. Established and visionary projects form the epicenter of its work, preparing it to make transformative impacts both in enterprise industries and in high-tech industries, thus, powering the rebirth of India as a global technology powerhouse.
