AJVC Closes $12M Fund to Support AI, SaaS, and Consumer Tech Startups

India’s A Junior VC (AJVC), by Aviral Bhatnagar, has secured Rs 100 crore ($12 million) for its debut venture fund. The fundraising comes amid a tough environment for new investors entering the market.

Bhatnagar aims to back 12-15 pre-seed startups annually across high-growth sectors such as artificial intelligence (AI), software-as-a-service (SaaS), and consumer technology. He sees early-stage funding as an overlooked opportunity in India’s rapidly growing startup ecosystem.

Bhatnagar, who previously worked at early-stage investment firm Venture Highway, launched AJVC after leaving the firm just before its acquisition by General Catalyst in June 2024. His debut fund has received strong backing from Indian family offices, unicorn founders, and senior investment executives. Domestic capital makes up the majority of the investment pool, while only 10% of the fund’s capital comes from foreign investors.

AJVC follows a structured investment model, offering Rs 1.5 crore for a 9% equity stake in pre-seed startups. So far, it has backed nine companies across sectors such as AI, B2B, consumer brands, and consumer technology. AJVC has also invested in startups based in non-traditional locations like Assam and Jharkhand, unlike many traditional venture firms. 

Despite the tough fundraising environment, Bhatnagar said the fund was oversubscribed, prompting discussions on exercising a greenshoe option to raise an additional Rs 50 crore. He highlighted a shift in India’s investment landscape, noting that domestic investors today have a higher risk appetite and a long-term perspective, unlike a decade ago.

AJVC’s launch comes when MicroVCs play a crucial role in bridging the early-stage funding gap in India. According to Blume’s Indus Valley report, investors have become more selective, making funds like AJVC essential for startups seeking initial capital. The strong demand is evident, with AJVC receiving over 5,500 applications from founders looking for early-stage funding.

Bhatnagar also acknowledged the challenges of scaling venture funds in India, stating that once a fund size crosses Rs 600 crore, returns become more difficult due to the limited number of startups that can reach a valuation of Rs 10,000 crore. Despite this, AJVC aims to identify and nurture high-potential startups in India’s evolving tech ecosystem.

AJVC plans to begin exiting its portfolio companies between Series B and Series C funding rounds. However, the firm does not intend to fully divest in one go and will instead take a phased approach to withdrawing capital. Bhatnagar emphasized that AJVC is in no rush to deploy funds or push startups toward rapid exits, ensuring they have long-term support.

With a fund lifespan of over 10 years, AJVC operates without immediate pressure to return capital at an aggressive pace. Bhatnagar stated that the firm prioritizes the growth and stability of its investments, offering sustained backing to startups for as long as needed.