500 Startups is adding a couple new micro-funds as it looks to further grow its investments in India and FinTech Markets. The $25 million funds, named 500 FinTech and 500 Kulfi (after a popular Indian frozen dairy treat), will continue to focus on early stage investments in those spaces.
500 Startups currently has over 80 FinTech investments that have made over the past six years, including investments in CreditKarma and Flywire.
In a post on 500’s blog, Partner Sheel Mohnot, who will be heading up the fund, detailed a few insights learned, including the importance of the proliferation of smartphones to cutting costs associated with financial services and the fact that “traditional” financial institutions are not innovating quickly enough.
500’s tagline for the new FinTech fund, “Financial Services For the Rest of Us,” is pretty representative of where they’re looking to target investments.
I chatted with 500’s Dave McClure who had just stepped offstage from the Surge Conference in Bengaluru, India. McClure told me that despite FinTech currently being “oversubscribed in certain areas,” there was still a lot of potential “particularly in regards to institutions serving women, millennials, minorities and emerging markets.”
In addition to also promoting FinTech-related investments in India, the new 500 Kulfi fund, headed up by Partner Pankaj Jain, will also be focusing on investments in EdTech, Health & Wellness, Data Analytics, Content and SaaS/SMB in the Indian region, also including Sri Lanka and Bangladesh.
Jain detailed in a blog post all the things that India’s investment environment has going for it, including “private equity investment activity in India was up 67% from 2014 to $21 billion,” expected GDP growth this year of 7.6%, 300 million internet users, smartphone numbers set to reach 700 million by 2020 and a youthful population with a median age of 27.3 years old.
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“We’re thrilled to announce our plans to do more in India; much, much more,” Jain wrote.
500 Kulfi joins other dedicated 500 micro-funds in the region. This past November, the firm nearly doubled the size of its Southeast Asia fund and created a $12 million Thailand fund.
