Alteria raised rupees 18.2 billion for its second debt fund less than a year ago.

Internal documents reviewed by Reuters have revealed that Alteria Capital Advisors is in discussions with investors to raise up to 35 billion rupees ($438 million) for its third debt fund. The funding, according to a pitch deck, will have a dual structure comprising a primary debt fund and a secondary pool that will be deployed as working capital finance for startups. (MINT)

While the primary debt vehicle is sized 20 billion rupees, the second tier fund, named “Scheme 2,” will have a corpus of up to 15 billion rupees.

The offering is expected to address the rising demand for venture debt by Indian startups, because it ensures availablity of funds without diluting the founder(s)’ stake – typical in the equity mode of venture capital.

Indian investment bankers Kotak Mahindra Wealth Management and IIFL Wealth Management are reportedly in an advanced stage of evaluation of investments in the fund.

Kotak managed Alteria’s second fund which closed in October 2021. “Our model, which focuses on extending patient capital with product flexibility and optimal risk-adjusted returns, has resonated well with investors and also gained us a wonderful set of entrepreneurs and portfolio companies,” said Ajay Hattangdi, Co-founder and Managing Partner of Alteria, at the time.

Alteria is ranked among India’s top three venture debt funds and has an AUM of 28 billion rupees. Its portfolio includes at least eight startups valued at $1 billion or above.

Related Story: As The Indian VC Scene Heats Up Alteria Raises $177M Venture Debt Fund

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