Planify’s VentureX Fund secures Rs 100 crore in commitments months after launch

Planify said that VentureX Fund, its SME-focused Alternative Investment Fund, has secured Rs 100 crore in commitments just nearly three months after its launch.

The fund’s early success signals growing investor confidence in the potential of small and medium enterprises, often recognized for their high growth and attractive returns.

Launch and investment strategy  

VentureX Fund was launched in December 2024 with the goal of tapping into the largely unexplored potential of the SME sector. It has been structured to deliver robust returns by investing in high-growth MSME companies that demonstrate strong fundamentals and scalable business models.

The fund targets enterprises that are either approaching listing or already listed on the Nifty SME Emerge or BSE Small Index, giving investors an opportunity for early-stage stakes in promising ventures.

Speaking about the fund’s approach, Rajesh Singla, chief executive officer and second fund manager of VentureX, explained that the next step is to expand the fund size by an additional Rs 250 crore, with a green shoe option of another Rs 250 crore.

This expansion, he said, will boost access to high-potential SMEs and diversify the fund’s investment portfolio.

Importance of SMEs in India  

Small and medium enterprises contribute nearly 30% to India’s gross domestic product and employ over 110 million people. Many of these businesses find it challenging to secure the capital and resources they need to grow, but investments through alternative investment funds can accelerate technology adoption and operational scalability. They can also help SMEs expand capacity and achieve sustainable growth.

In 2024, there were 239 SME initial public offerings, delivering returns of about 135%, a figure that highlights rising investor confidence. Singla pointed out that although news coverage of SMEs often focuses on incidents of financial mismanagement, many SMEs with sound operations are creating considerable value for both investors and the broader economy.

Reasons behind the fund’s SME focus  

Singla said the decision to focus on the SME sector was rooted in its critical role in India’s economic landscape. Despite this importance, he added, many SMEs struggle to access the financial support they need to compete effectively.

VentureX aims to address this gap by providing investment and guidance that can help SMEs scale up, adopt advanced technologies and become more competitive in domestic and global markets.

According to Maneesh Nath, the first fund manager at VentureX, SME investments have generally exceeded market benchmarks. Citing a 61% compound annual growth rate for SMEs over the past five years, Nath noted that these returns surpassed the 28% CAGR of the Nifty Small Cap and the 20% CAGR of the Nifty 50 in the same period.