India based early stage seed and pre series A venture fund, Blume Ventures has decided to enter the reserve mode and limit company interactions to minimal till it raises its second funding, which is expected to be around US$50 million. Blume usually invests in early stage tech focused and tech enabled ventures.
Blume in its ninth quarterly report, stated that it has invested in 60 companies in three years since its first closing (which closed June 2012).
Karthik Reddy and Sanjay Nath, founders of Blume Ventures also addressed the rumours of ‘exits’ that have been circling the industry for quite some time. The report said:
“People keep asking us about our ‘Exits’. They’ve been asking since six months of the fund. If there were exits at this juncture, they would mostly amount to very little in absolute amounts, relative to what’s required to return the fund at three times or more.”
In the coming year, Blume expects its portfolio companies to deliver 8-10 Series A (Blume has already had 6 series As) 2-3 Series Bs (From the 6 Series A companies) 2-3 Small acquisitions/ exits (In addition to Qubecell & Adepto) 1-2 Tiny specks on the horizon, probably Blu Swans (subset of A/B list)
Focus on Blue Swans
Blume Ventures coined the term ‘Blue Swans’ for companies that will be able to single handedly return a significant amount of the Total Fund. Blue Swan companies will be the focus of Blume Venture’s investments in the coming time.
“It’s an incredible feeling to see them emerge. Yes, these are forward-looking crazy statements. But, we’re happy to make them transparently to our investors,” the report said.
The report states that to nurture a company to grow into a Blue Swan one has to pick a team and an idea at a reasonable entry valuation and yet see a massive product/revenue spike to the A round.
Some of the key investments made by Blume Ventures between July 2013 and September 2013 include AudioCompass, a mobile travel guide and Homeveda, a health and wellness website. The syndicated investments made in this period included Instamojo, a website that allows users to sell digital products and services online and Tripvillas, a portal that allows its users to rent homes for their vacations.
With a fresh round of funding on the way for Blume Ventures, the funding and investment space is expected to buzz with action this year.
The detailed report is can be viewed here.
Featured and Lead Image Courtesy: Blume Ventures