3one4 Capital partially exits Kuku FM with 90% IRR

VC firm 3one4 Capital has sold part of its stake in audio streaming startup Kuku FM. The partial exit happened about a month after Kuku FM raised $85 million in its Series C funding round.

3one4 Capital said that selling part of its stake gave it very strong returns — about a 90% internal rate of return (IRR) and a 38.4× multiple on the money it had invested (MOIC). The sale also brought in a large payout compared to the total money the firm had put into the fund (DPI).

The VC firm first invested in Kuku FM during its seed round in 2019, along with India Quotient and Shunwei Capital.

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Led by Pranav Pai, the firm continued to increase its investment in the audio platform by also taking part in Kuku FM’s Series A and Series B funding rounds.

Kuku FM completed its Series C funding round in October, raising $85 million. Investors included Granite Asia, Vertex Growth Fund, the International Finance Corporation, Paramark, Tribe Capital India, and others.

“Kuku exemplifies the qualities we seek in every investment: pre-consensus insight (seeing value in regional language audio before it was obvious), executional excellence (delivering consistent growth and innovation against all odds), and long-term category leadership (shaping the future of digital entertainment in India),” it noted.

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In total, Kuku FM has raised more than $156 million across seven funding rounds since it started.

Financially, its operating revenue in FY24 more than doubled to INR 88 crore, while its net loss fell 18% to INR 96 crore. The company has not yet shared its financial results for FY25.

This is the VC firm’s third exit this year. Earlier, it fully exited ToneTag in June with 5–7× returns and also made 58× returns from its full exit from HR tech unicorn Darwinbox.

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