Sparrow Capital Closes Third Fund at ₹475 Crore for Seed Stage Startups

Venture capital firm Sparrow Capital has announced the closure of its third fund, raising ₹475 crore (approximately $50 million) and surpassing its initial target of ₹400 crore.

The fund is sector-agnostic, and Sparrow Capital intends to back 25 to 30 startups over the next three years with initial investments ranging from $1 million to $2 million. The firm has already made five commitments from this new fund.

Sixty percent of Fund III's capital originated from global endowments, foundations, funds of funds, and family offices. The remaining capital was contributed by startup founders and operators, Indian family offices, and high-net-worth individuals, marking a shift from its previous base of predominantly non-institutional investors.

Founded in 2020 by Yash Jain, Aakash Goyal, and Darshit Vora, Sparrow Capital has expanded its leadership with the addition of Arpit Agrawal as CFO and partner for Fund III.

The firm has supported over 40 startups across enterprise tech, e-commerce, consumer services, fintech, and edtech sectors. Its portfolio includes companies such as GoKwik and Apna Mart. The increased average check size of $1 million to $2 million for Fund III allows Sparrow Capital to lead or co-lead seed rounds, a step up from its Fund II which closed at ₹120 crore, backing 27 startups with smaller investments.