BENGALURU: Fundamentum Partnership, the growth-stage investment firm co-founded by Infosys co-founder Nandan Nilekani and veteran entrepreneur-investor Sanjeev Aggarwal, has launched its third fund with a target corpus of Rs 2,200 crore, including a Rs 400 crore greenshoe option.Nilekani will anchor the fund as a limited partner (LP). Fundamentum said this marks his largest commitment to any venture capital firm.Aggarwal, who earlier co-founded Helion Venture Partners and has backed companies such as MakeMyTrip, RedBus, BigBasket, Spinny and PharmEasy, founded Fundamentum with Nilekani in 2017 to focus on Series B investments in Indian technology companies.Series B is typically the stage at which startups have moved beyond early product-market fit and require larger pools of capital to scale. Fundamentum was created to address this funding gap in India, where seed and Series A capital has become more widely available but relatively few investors specialise in growth-stage financing.“India’s Series B moment is now,” Mayank Kachhwaha, general partner at Fundamentum, told TOI. He said the expansion of the early-stage funding ecosystem has created a much larger pipeline of companies ready for growth capital.Fundamentum Fund III will continue the firm’s strategy of backing startups that have achieved product-market fit and are preparing to scale. The fund will write initial cheques of Rs 100 crore to Rs 150 crore and typically seek 10-15% ownership in portfolio companies.Kachhwaha said the firm expects to make eight to 10 investments from the new fund. Around 60% of the corpus will be deployed as initial investments, while the remaining 40% will be reserved for follow-on rounds. The first close is expected within the next three to six months.Fundamentum’s first fund, launched in 2017, was a $90 million pilot fund, while its second fund, launched in 2022, exceeded $200 million. Kachhwaha said Fund III will be broadly similar in size and strategy to Fund II, with the firm continuing its approach of backing a smaller number of companies with larger investment sizes.The new fund will focus on consumer technology, fintech, and AI-native or AI-enabled businesses. While Fundamentum does not earmark capital for specific sectors, Kachhwaha expects about 80% of Fund III to be deployed in consumer and fintech startups, with the remaining 10-20% likely to go towards AI-native companies and AI-led services businesses.The firm will continue to avoid highly capital-intensive sectors. Instead, it looks for businesses with strong customer affinity, product-market fit, defensible business models, healthy unit economics and a clear path to profitability.“We are extremely particular about unit economics working at the time we come in. We really don’t take a leap of faith on unit economics and the path to profitability,” Kachhwaha said.Fund III also marks a broader leadership transition at Fundamentum. While Nilekani will continue as the anchor LP, the new fund will be led by Aggarwal, Prateek Jain, Kachhwaha and Sanjay Chaturvedi as general partners. Jain and Chaturvedi have been with Fundamentum since its inception, while Kachhwaha joined during Fund II to build the firm’s fintech investing practice.Kachhwaha said Nilekani and Aggarwal have sought to build Fundamentum as a long-term investment institution, with younger leaders gradually taking on GP responsibilities. Aggarwal will continue to serve as a general partner in Fund III.Fundamentum has also launched F2A, a separate AI and deeptech-focused investment platform. Kachhwaha said any overlap between Fund III and F2A in AI investments would be assessed on a case-by-case basis.The firm’s portfolio includes Spinny, PharmEasy, Kuku, AppsForBharat, ApnaMart, FlexiLoans, Stable Money, TransBnk, Olyv and ProcMart. Fundamentum said Fund II has delivered a gross internal rate of return (IRR) of 26%, while its portfolio companies recorded 123% growth over the past year.In a statement, Nilekani said India’s challenge is no longer a shortage of entrepreneurial ambition, but building institutions that can endure and create value over decades.Aggarwal said Fundamentum was founded to help entrepreneurs navigate the scale-up journey beyond just providing capital. “As we launch Fund III, we are excited to see the evolution of home-grown leaders within the firm take on the mantle of general partners,” he said.