Sparrow Capital said 60% of Fund III’s capital came from global endowments, foundations, funds of funds and family offices
The VC firm has backed over 40 startups across enterprise tech, ecommerce, consumer services, fintech and edtech sectors to date
Its Fund II, which closed at ₹120 Cr, backed 27 startups with cheque sizes of $300K to $500K
VC firm Sparrow Capital
has closed its third fund with a corpus of ₹475 Cr (about ₹50 Mn), surpassing its initial target of ₹400 Cr.
The fund is sector agnostic and Sparrow Capital plans to back 25-30 startups over the next three years with ticket size in the range of $1 Mn to $2 Mn. The firm, in a statement, said it has already made five commitments from the fund.
Sparrow Capital said 60% of Fund III’s capital came from global endowments, foundations, funds of funds and family offices. The remaining capital was raised from startup founders and operators, Indian family offices and high-net-worth individuals. This is a departure from its earlier LP base of predominantly non-institutional investors.
Sparrow Capital was founded in 2020 by Yash Jain, Aakash Goyal, and Darshit Vora. Arpit Agrawal has joined the leadership team as CFO and partner for Fund III.
The VC firm has backed over 40 startups across enterprise tech, ecommerce, consumer services, fintech and edtech sectors to date. It counts GoKwik, Apna Mart, Deconstruct, E6data, Gushwork, Furnishka, Aukera, Strainx, Superhealth, Homerun and Optimist among its portfolio startups.
The average cheque sizes of $1 Mn to $2 Mn for the third fund is higher than that disbursed in previous funds, allowing the firm to lead or co-lead seed rounds. Its Fund II, which closed at ₹120 Cr, backed 27 startups with cheque sizes of $300K to $500K.
With the Indian startup ecosystem continuing its strong growth, seed funding is seeing strong uptick as investors bet on emerging startups, especially in deeptech and AI sectors.
In the first half of 2026, seed stage funding rose 18% YoY to over $478 Mn, compared to a 29% YoY decline in late stage investments, according to Inc42’s ‘Indian Tech Startup Funding Report, H1 2026’. The total number of seed deals during the period stood at 208, compared to 66 made in late stage companies.
Overall, Indian startup funding declined 9% YoY to $5.2 Bn in H1 2026.
Source: Inc42 - Startups
