Nexus isn’t going all-in on AI, keeping half of its new $700 million fund for Indian startups | TechCrunch

While many venture capital firms today seem to only have an eye for AI, Nexus Venture Partners is deliberately splitting its focus for its new $700 million fund.

The company will back AI startups and look for India-focused startups in consumer, fintech and digital infrastructure.

I have Most of the venture capital raised worldwide was gobbled up and the 20-year-old VC firm also sees AI as a defining technological shift. But it argues that crowding into a single, overheated category carries its own risks. India’s digital economy provides a counterbalance: a growing market where AI adoption is increasing and opportunities remain more diverse.

For Nexus, that balance is rooted in its origins. The Delaware-based firm, with offices in Menlo Park, Mumbai and Bengaluru, has operated as a single fund and an integrated team between the US and India since its inception in 2006.

It supports early-stage software and India-focused startups from the same capital pool. Over time, cross-border software bets have spanned a range from infrastructure and developer tools to AI agent startups. The US portfolio includes companies such as Postman, Apollo, MinIO, Giga and Firecrawl, which have seen widespread adoption in developer tools and AI infrastructure.

Meanwhile, the Indian portfolio has expanded into consumer, fintech, logistics and digital infrastructure. Some of the bets there are Zepto, Delhivery, Rapido, Turtlemint and Infra.Market

“AI is a huge inflection point, and we are anchoring ourselves in that,” Jishnu Bhattacharjee, managing partner at Nexus Venture Partners in the US, told TechCrunch in an interview. “But we also see that many of these AI innovations are actually being used to better serve the masses.”

Nexus manages $3.2 billion of capital in its funds and has invested in more than 130 companies over the years. The company has recorded more than thirty exits to date, including several IPOs, underscoring the depth of its early-stage, long-horizon approach.

Abhishek Sharma, managing partner at Nexus Venture Partners in the US, told TechCrunch that the company’s sweet spot is still seed to seed and Series A, often starting with checks of just a few hundred thousand dollars or around $1 million.

Nexus, which operates with an eight-member investment team, started with a $100 million fund and has since kept the fund size at $700 million. launch of Fund VII in 2023. It is usually increased every 2.5 to 3 years. Bhattacharjee said the reason for keeping the eighth fund of the same size was that the company believes $700 million is the right amount for its early-stage strategy.

“We don’t want to raise money for the sake of raising it,” he noted.

Even though India’s AI journey is not yet as advanced as that of the US in many areas, Nexus believes India can leapfrog in several parts of the AI ​​ecosystem.

Bhattacharjee underscored the country’s deep talent pool, growing digital infrastructure and demand for localized models that support India’s many languages ​​and service needs. This dynamic, he said, is forcing Indian startups to build AI applications and agents faster, often on top of open-source tools and emerging domestic AI infrastructure companies.

The partners pointed to Nexus-backed companies such as Zepto and Neysa to illustrate how AI is taking shape in India. They said that Zepto, the quick-commerce platform, is using AI extensively in all its operations – from customer support to routing and fulfillment – ​​demonstrating how consumer businesses are becoming deeply AI-native. Additionally, infrastructure players like Neysa are emerging to address India-specific needs, including sovereign AI workloads, localized data processing, and support for the country’s many languages.

Nexus did not share fund statistics. The partners said their funds have generated sufficient returns over the years to largely fill this fund with returning limited partners. The company’s LP base includes the US, Europe, the Middle East, Southeast Asia and Japan.