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Hyderabad-based VC firm Pavestone marks final close of Rs 816 crore fund

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  • Successful Fundraising: Pavestone, a venture capital firm based in Hyderabad, has closed its Pavestone Technology Fund with a total corpus of Rs 816 crore, surpassing its initial target of Rs 600 crore and later increasing its goal to Rs 900 crore due to strong investor demand.

  • Investment Focus: The fund aims to invest in approximately 14 to 15 early-stage B2B technology startups in India, with average investments ranging from $5 million to $10 million, prioritizing firms with substantial market traction and established enterprise relationships.

  • Targeted Sectors: Pavestone’s investment strategy is concentrated on sectors such as generative AI, cloud computing, immersive technology, and bioengineering, with about 80% of the funds dedicated to solving large-scale B2B challenges.

  • Moonshot Projects: The remaining 20% of the fund will be allocated to high-risk, high-impact projects involving frontier technologies, emphasizing innovation and potential breakthroughs.

  • Early Investments: Pavestone has already made investments in five startups, including E42 (AI platform), Bellatrix Aerospace (space propulsion), LivNSense (industrial AI for decarbonization), NewSpace Research & Technologies (defense aerospace), and Cynlr (visual robotics), aligning with its strategy of supporting impactful technological solutions.

Pavestone, a Hyderabad-based venture capital firm, recently finalized the close of its Pavestone Technology Fund at a total corpus of Rs 816 crore, exceeding its original target of Rs 600 crore.

The firm initially increased its goal to Rs 900 crore using the greenshoe option twice to meet strong investor demand.

Focus on enterprise and frontier technologies

Through this fund, Pavestone aims to support early-stage growth in approximately 14 to 15 business-to-business (B2B) technology startups, primarily in India.

The average investment in each startup is expected to range between $5 million and $10 million. Pavestone is prioritizing startup with substantial market traction and established relationships with significant private and public enterprise clients.

The fund’s strategy emphasizes sectors like generative artificial intelligence, cloud computing, immersive technology, and bioengineering, with about 80% of funds dedicated to solving large-scale B2B challenges.

“The fundamental thesis of the fund is focused on enterprise technology that addresses public enterprise needs in the B2B space,” said V. Laxmikanth, managing partner at Pavestone.

The remaining 20% of the capital will be directed toward “moonshot” projects involving high-risk, high-impact frontier technologies, according to Laxmikanth.

Early investments and industry impact

So far, Pavestone has made early investments in five startups: E42, a no-code artificial intelligence platform; Bellatrix Aerospace, an in-space propulsion startup; LivNSense, an industrial AI platform focused on decarbonization; NewSpace Research & Technologies, a defense-focused aerospace company; and Cynlr, which develops visual robotics technology.

These companies align with Pavestone’s strategy to invest in innovative firms capable of impacting large markets with advanced technological solutions.

“We are committed to timeless investment principles such as rigorous analysis, risk management, and governance,” Laxmikanth said, emphasizing the long-term view Pavestone takes in a rapidly evolving market.


Here’s a summary based on the information provided:

Fund:

  • Name: Pavestone Technology Fund
  • Total Corpus: Rs 816 crore (original target Rs 600 crore, later increased to Rs 900 crore using greenshoe options)
  • Focus: Enterprise and frontier technologies in the B2B sector

Investors:

  • The specifics of the investors are not provided in the text. However, it mentions "strong investor demand," indicating that multiple investors contributed to reaching the final corpus of the fund.

Startups:

Pavestone has made early investments in the following five startups:

  1. E42: No-code artificial intelligence platform
  2. Bellatrix Aerospace: In-space propulsion startup
  3. LivNSense: Industrial AI platform focused on decarbonization
  4. NewSpace Research & Technologies: Defense-focused aerospace company
  5. Cynlr: Develops visual robotics technology

Founders:

  • The information provided refers to V. Laxmikanth, the managing partner at Pavestone, as a key figure associated with the fund. Details about other founders or partners were not mentioned.

Fundraising Series:

  • The specific series of fundraising for each startup is not detailed in the provided information. The fund’s focus is primarily on early-stage growth startups with an investment range of $5 million to $10 million each.

Investment Strategy:

  • 80% of funds: Directed towards B2B technologies addressing large-scale enterprise challenges (e.g., generative AI, cloud computing, immersive technology, bioengineering).
  • 20% of funds: Allocated for high-risk, high-impact "moonshot" projects involving frontier technologies.

This captures the essential elements regarding funds, startups, and the strategy outlined in the provided text.

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