General Catalyst merges with Venture Highway to expand in India
Silicon Valley-based venture capital group, General Catalyst, is merging with Indian venture firm, Venture Highway. The merger is part of a strategic plan to expand General Catalyst's presence in India. The two firms will earmark between $500 million and $1 billion for investments in the country. The deal was first reported by TechCrunch in January, stating that the two venture firms were engaging in a deal.
A multi-stage investment strategy
The merged entity will develop a multi-stage investment strategy for General Catalyst in India. The strategy will span early- and growth-stage start-ups across various industries. Venture Highway's founder, Neeraj Arora, and its GP, Priya Mohan confirmed this in an interview with TechCrunch. Venture Highway, which raised $78.6 million for its second fundraise in 2020, has traditionally focused on early-stage investments.
Venture Highway's expanded role and vision
As part of the General Catalyst team, Venture Highway will expand its role to include incubating start-ups. "Our vision is to be part of building a number of companies that will not only go public but also be needle-moving for the economy," Mohan said. General Catalyst handles over $25 billion in assets. The venture plans to invest between $500 million to $1 billion in India, over the next three years, said Arora.
GC's position in India post-merger
The merger positions General Catalyst as one of the largest venture capital firms in India. Other major players include Lightspeed, Elevation, Nexus, and Accel, which have each raised between $500-700 million for their recent funds. Peak XV Partners leads the pack with a $2 billion fund earmarked for investments in India.
Approach to Venture Highway's portfolio
General Catalyst will not be acquiring Venture Highway's portfolio but will consider them "very much part of the GC portfolio going forward," Hemant Taneja, General Catalyst's CEO told TechCrunch. "We want to support them the same way we support any of our companies in India or anywhere else in the world," he added. The two firms began exploring ways to collaborate several years ago.
Venture Highway's future under GC
As part of the deal, the Venture Highway brand will cease to exist and will be known as General Catalyst India going forward. All portfolio companies of Venture Highway will continue to be served in the same manner as earlier, just that it will be done through General Catalyst India. Most of the capital from Venture Fund's third fund has largely been deployed, and all upcoming investments shall be made via the General Catalyst brand name.
