London-based early stage venture capital firm Ascension Ventures has announced a joint venture with Unicorn India Ventures (UIV), launching the first UK-India Enterprise Investment Scheme (EIS) Fund.
Known as the Unicorn Ascension EIS Fund (UAF), it will leverage the EIS tax relief wrapper to enable investment into UK-based technology scale-ups which hold a focus on products and services that can expand into the Indian market.
The fund’s UK team will work out of Ascension’s London offices, while the Indian team will be based in UIV’s offices in Delhi, Mumbai and Bengaluru, meaning that scale-ups which receive investment can expect local business support on both continents.
“The fund presents a double benefit, where the EIS tax reliefs afforded to UK investors can significantly reduce their capital at risk, whilst the India angle offers a unique exposure to one of the largest and fastest growing economies in the world,” said Jean de Fougerolles, a partner of the new UAF Fund and the founder of Ascension Ventures.
The Unicorn Ascension Fund will capitalise on recent efforts by UK chancellor Philip Hammondto bring the UK and India closer together via a tech partnership, with a vision for the UAF to eventually become the fund of choice for pre-Series A tech startups in the UK looking to expand into India.
Ascension itself has a history of investment under its belt, providing funding to more than 70 UK-based early stage tech businesses across 10 separate funds since 2012. The venture capital firm currently has £22m in assets under management.
Meanwhile UIV is in the process of launching two new tech funds in India, to the tune of £75m in venture debt for early/growth stage startups, and a £10m breakthrough fund to back high-performing companies from UIV’s first fund.
“It’s encouraging to see that companies from the UK have already started venturing into the Indian market,” said UAF partner Bhaskar Majumdar. “While companies like Yoti and Falcon Media House have successfully launched their products and services into India, other companies like Deliveroo have also expressed their intention to follow suit.”
With a goal of making six to eight deals per year, the UAF will co-invest approximately a third of each round, with the rest to be made up by angel investors and other venture capital firms. Applications are set to open this month, with the first deployments of capital to be made in September.