With a mission to hone the founders of the next generation of category-defining brands in India and Southeast Asia; venture capital firm DSG Consumer Partners announced the final close of its fourth fund at $114 million.
“Fund II was $50 million, and Fund III was $65 million, so $115 million in total. Fund IV is $114 million – so $1 million short of the combined 2 previous funds. Our story has not changed over the last decade. DSGCP was set up to support the most mission-driven entrepreneurs building the next generation of insurgent consumer brands. That was our mission in 2012, and that is our mission today,” DSGCP’s managing director and founder, Deepak Shahdadpuri, said in an interview.
According to the company statement, 72% of the capital for Fund IV was raised from existing LPs. The additional 28% was from first-time LPs, which were mainly single-family offices or strategics from the consumer category. Some of the new LPs who have publicly disclosed their participation are L’Oreal and Wipro Consumer Care.
Previously, the firm has backed 80 companies across its three funds. DSGCP is already doubling down on their conviction in the consumer opportunity through Fund IV. They have already partnered with Farmley, Go Desi, KNYA, Bombay Banta, Go Zero, and Merlin Brands in India; Blood and Moom, which operate in Singapore, Malaysia, and Indonesia; Pickup Coffee in the Philippines; and Coolmate and Marathon Education in Vietnam.
The company disclosed that it has set aside $80 million of the corpus for its core strategy of Seed and Series A. Moreover, the remaining $34 million will go towards early growth cheques for consumer brands that the firm did not invest in during Seed or Series A. The brand has validated this strategic placement through the changing market in India.
DSG Consumer Partners and their aim
Deepak I. Shahdadpuri established DSG Consumer Partners in 2012. He boasts over 20 years of private capital experience in both private equity and venture capital. The firm was established with a belief in the prospects of insurgent consumer brands in the youngest and fastest-growing economies in the world—India and Southeast Asia. They established themselves as long-term partners who work with their founders throughout their journey; offering strategic mentorship, product development and operational expertise, industry knowledge, and access to the firm’s global management network.
DSG believed that insurgent brands would take a significant share from incumbents and also create new categories across all aspects of the consumer wallet. This belief is further proven through some of their winning portfolio brands across 10 different categories, like OYO, Veeba, Sula, Epigamia, Saladstop, Chaipoint, Leverage EDU, and Saturdays, amongst others.
“In terms of returns and exits, I can share this. As of June 30, 2023, on an aggregate basis, we have called $129 million, invested $108 million, realised $72 million, and distributed $54 million,” Shahdadpuri talked about the companies’ accomplishments.
The founder also shared the prospects of the companies in Southeast Asia. While the markets are fragmented, they are still large and attractive enough to offer many opportunities. Previously, DSG invested in Philippines-based Pickup Coffee with the conviction that the brand could grow further in its home market.
For the new fund, the firm will continue to focus on eight core consumer themes; Looking and Feeling Good, Healthy Living, Luxury and Aspiration, Convenience, Evolution of the Family and Home, Unorganized to Organized, Plant-Based Consumerism, and Sustainability.