Xponentia Capital Partners, the mid-market focused private equity fund, has raised Rs 365 crore in first close of its second fund – Xponentia Opportunities Fund 2 from Indian corporates, family offices and High Net-worth Individuals, according to The Economic Times.
The firm is looking to raise Rs 750 crore for the final close of the fund and is expected to achieve the final completion before December.
The Mumbai-based Xponentia was founded in 2018 by PR Srinivasan and Devinjit Singh, It raised its first fund of Rs 351 crore in 2019. With its limited partners, or sponsors, who co-invested in the deals, the firm has invested a total of Rs 450 crore from its first fund.
The firm’s portfolio includes the Flight Simulation Technology Center or FSTC, Barbeque Nation, R4Rabbit, Easy Home Finance, Medsource and Altigreen.
The firm has made about eight investments from fund I and will try to do around 8-10 from fund second.
“Our fund performance is driven by realized exits and is not based on valuation mark-ups alone. As a matter of fact, Distributions to Paid in Capital or DPI is above 90% in XOF-1. Also, timely exits have enabled us to reinvest and deploy 100% of the fund, reducing the spread between gross and net IRR,” said, Srinivasan, managing partner, Xponentia Capital.
It backs companies in sectors such as financial services, healthcare, consumer and business services that have a proven business model and the potential to generate around Rs 30-35 crore in earnings before interest, tax, depreciation and amortization (EBITDA).
In August 2021, when Delhivery acquired Spoton Logistics, Xponentia pulled out of its investment entirely. In addition, it partially sold its stake in Barbeque Nation after listing on the exchanges in April 2021.
“Domestic investors are highly under-allocated to classic private equity and alternatives as an asset class, and both family offices and institutions are keen to invest behind managers with track records and demonstrated performance. We are highly confident that we will achieve and probably exceed, the fund-raising target for our second fund in the coming few months,” said, Singh, managing partner, Xponentia Capital.
Xponentia was set up to address the paucity of capital in the Indian mid-market corporate sector. Inspite of having dynamic and enterprising entrepreneurs who are building world class businesses, this segment of the Indian market has traditionally been faced with a dearth of capital providers – both debt and equity.
Xponentia aims to be a value added partner who can catalyse sustainable growth by providing capabilities & capital to their portfolio companies. Leveraging decades of investing experience, Xponentia has developed a unique Value Creation Strategy that provides a compelling value proposition to their portfolio companies with demonstrated results.
With a successful track record of investing over $1billion of capital, Xponentia’s Founders have a long and successful history in the Indian market for over three decades, and previously led the investment teams of The Carlyle Group and Citigroup Venture Capital International (CVCI) & HSBC Private Equity.