A Square Capital to launch $40 mn VC fund, targets healthcare, tech, consumer sectors
The fund expects to receive Securities and Exchange Board of India (Sebi) approval by January or February and is in talks with potential limited partners in overseas and domestic markets to set up its first vehicle, the first person mentioned above said on condition of anonymity.
“The fund will invest in sectors including healthcare, technology, deep tech, artificial intelligence, fintech and consumer brands,” said the first person aware of the fundraising plans.
The second person aware of the fund’s activities said that over the life of the fund, approximately 80% of the corpus will be distributed to technology startups, while the remaining 20% will be allocated to consumer goods and tangible D2C brands.
The fund plans to make 10-15 investments per year and check sizes are around 500 lira. ₹75 lakhs ₹1 crore per deal. We will focus on the early stage of Series A rounds and evaluate companies only post-revenue,” this person added.
According to the second person cited above, who requested anonymity, the fund has already received commitments of around $20 million from its backers, including managing partner Chahat Agarwal.
“The rest of the capital will come from foreign limited partners; as of now, the fund is not looking at domestic LPs,” the person said.
When contacted by MintA spokesperson for the company declined to comment on the story.
Industry mix
Square Capital is structured as an Indian fund and is headquartered in Delhi. A Square Capital, founded by marketing and branding expert Chahat Agarwal, who worked on Oyo’s expansion in the United Kingdom and Southeast Asia, will be industry agnostic, with an emphasis on healthcare and consumer brands, according to two people familiar with the plans.
Healthcare will be a key area of focus, with the fund bringing domain expertise spanning specialty care, policy and government systems, the first person said.
Key Takeaways
- A Square Capital, a new domestic VC, is launching its first fund targeting $40 million and has applied for a Category I AIF license from Sebi.
- The fund will allocate 80% of its corpus to technology, deep technology, artificial intelligence and fintech startups, and the remaining 20% to consumer/D2C brands.
- The fund will aim to initiate Series A rounds in revenue-generating companies and plans 10-15 investments per year with check sizes between ₹ 75 lakh and ₹ 1 crore.
- $20 million has already been committed by the promoter and the remaining capital is expected to come from foreign Limited Partners only.
- A Square Capital positions itself as a company that goes beyond typical investor/accelerator offerings, offering founders end-to-end support including funding, go-to-market strategy, product development and scaling.
Until the license is obtained, Agarwal is making personal investments. “While we are waiting for the Sebi license… Chahat is investing individually for now until she gets the fund licence,” the first person added.
The fund will look at technology-focused opportunities beyond healthcare and will remain largely sector agnostic, the first person confirmed.
Beyond providing capital, the fund aims to offer founders end-to-end support on go-to-market strategy, product development, scaling and access to a vetted network of advisors and investors, working with teams from validation of ideas to fundraising and scale-up, according to two people familiar with the plans previously cited.
“The offering includes fundraising support, go-to-market strategy, product development and scaling positioned to go beyond what traditional accelerators or investors typically provide,” the first person said.
Early-stage venture firms have remained active in India over the past year, announcing new funding and initial closes on seed and Series A strategies. Recent vehicles include new funding from Prime Venture Partners and 247VC, as well as the first close of Blume Ventures’ Fund V.
market growth
Blume Ventures recently set the first close of its fifth fund at $175 million and plans a final close of $250-275 million in early 2026. In March, Prime Venture Partners launched a $100 million Fund V with more than 80% of commitments secured. Starting from the second half of 2025, Nivasa Finance started distributing funds to companies such as Klaar, Illmine and Metafin.
Among micro VC participants, 247VC launched India Fund I in May. ₹200 crore corpus and ₹50 crore green shoe options (targeting ₹250 crore) is registered as a Category II AIF to lead seed rounds with follow-on capital.
India has seen more fund launches this year compared to all of 2024, according to Inc42’s Third Quarter 2025 India Tech Venture Funding Report. In the first nine months of 2025, investors announced more than $9 billion in funding, exceeding the $8.7 billion figure in 2024.
According to the report, more than $2.5 billion in new funding was raised across 25 investors in the third quarter alone, with 17 vehicles specifically targeting early-stage startups. The report also showed that around 60% of new fund launches in 2025 are targeting seed and Series A rounds, with a clear trend towards early-stage deals.
