Exfinity has invested in 40 startups so far and has completed 17 investments from its third fund, with one more deal to be announced. The firm typically aims for 10-20 per cent ownership and expects cheque sizes to rise modestly in the new fund.Exfinity Venture Partners launches ₹1,100 crore Fund IV for deep-tech betsExfinity Venture Partners has launched a ₹1,100 crore fourth fund, expanding its focus on semiconductors, physical AI, advanced compute, robotics and enterprise AI software.
The filing for Fund IV has been submitted to SEBI and the firm expects to start raising shortly, partners Chinnu Senthilkumar and Jesper Ludolph told ETEntrepreneur. The fund will remain early-stage focused but allocate a larger portion to follow-on rounds, given longer build and commercialisation cycles in deep tech.
Exfinity has invested in 40 startups so far and has completed 17 investments from its third fund, with one more deal to be announced. The firm typically aims for 10-20 per cent ownership and expects cheque sizes to rise modestly in the new fund.
Early bets finding validation
Senthilkumar said some of the firm’s earliest investments are now being validated as global markets shift. Exfinity backed semiconductor startup Kinara AI in 2018 well before interest surged around specialised AI chips. Kinara was acquired by NXP Semiconductors last year in one of India’s notable deep-tech M&A deals.
The firm also invested in Chara Technologies, which builds rare-earth-free motors, more than three years before geopolitical concerns around critical minerals became mainstream. “We have consistently taken bets well ahead of the curve,” Senthilkumar said. “These outcomes validate the deep-tech thesis we have held from the beginning.”
Ludolph added that the competitiveness of India-built IP has become clearer to global industrial and technology companies. “International players are now looking at India for niche innovations whether in edge AI, cybersecurity, or supply chain automation,” he said. “We expect this demand to strengthen as American, European and Japanese companies expand engineering and R&D centres in India.”
Fund II achieves full capital return
Exfinity recently achieved full capital return for its 2016-vintage Fund II, supported by a series of cross-border exits over the past 12 months, including the acquisitions of Kinara, Locus, and AI Palette by multinational buyers.
The firm said these outcomes underline the growing appetite of global enterprises for India-origin deep-tech and enterprise AI software.
According to the partners, strategic M&A has emerged as a reliable exit pathway for Indian deep-tech startups, alongside domestic IPOs and growth-stage private equity. The firm continues to hold positions in several scaled companies from Fund II.
New areas for Fund IV
While Exfinity will maintain its focus on deep tech and AI-powered software, Fund IV will also target emerging categories such as photonics, quantum computing, hydrogen and energy systems, and life sciences. The firm has not previously invested meaningfully in life sciences but now sees the ecosystem maturing.
“We are seeing founders with deep research experience coming back to build from India,” Ludolph said. “Life sciences and drug discovery are becoming attractive because even a one-month reduction in development cycles can create significant value.”
Senthilkumar added that the firm expects to stay invested longer in some companies from the new fund. “We will likely go up to Series C for the right companies because a lot of value is created by staying longer in deep tech,” he said.
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