The Busy Brains
23 Jun 2023
Gaming-focused venture capital fund Lumikai unveils Fund II, with a target corpus of $50 million, to invest in pre-seed to Series A firms in the gaming and media sectors. The fund has already secured commitments from notable limited partners and aims to contribute to the growth of India's thriving gaming industry.
Lumikai, a venture capital fund focused on gaming, announces the launch of its second fund, Fund II, with a target corpus of $50 million. The fund aims to invest in early-stage gaming and media startups, ranging from pre-seed to Series A stages. Lumikai's first fund, raised in 2020, amounted to $40 million and has previously backed successful startups like Loco, Elo Elo, and Bombay Play.
Salone Sehgal, founding general partner at Lumikai, reveals that 75% of the funds from Fund I have already been deployed. Both funds will have a maturity horizon of ten years, indicating a long-term commitment to supporting the growth and development of the gaming and media sectors.
"We have already deployed 75% of the funds from Fund I, and both the funds will have a maturity horizon of ten years," said Salone Sehgal, founding general partner at Lumikai.
Currently, Lumikai is in term-sheet stage conversations with three potential investee firms from Fund II. The fund has secured commitments from prominent limited partners, including Krafton, Nazara, and Napster CEO Jon Vlassopulos. The Indian gaming sector has experienced significant investment growth, raising $2.8 billion in the last five years, according to Invest India.
Akshat Rathee, co-founder of Nodwin Gaming and a limited partner in Lumikai's Fund II, emphasizes the importance of access to capital for middle-stage companies with strong business models, as it will enable them to scale phenomenally in the dynamic gaming industry.
The Indian gaming industry is not just pre-revenue products and the deployment should be pragmatic… access to capital for middle-stage companies with a good model will help them scale phenomenally," said Akshat Rathee, co-founder of Nodwin Gaming and a limited partner in Lumikai's Fund II.
India's gaming sector is thriving, with an estimated 400 to 500 million gamers engaging in various types of games, including casual games, competitive games like Battlegrounds Mobile India, and real money games (RMG) like Dream 11. Lumikai's deep sector expertise and connections to gaming firms and investors in the US and Japan provide an edge in the gaming investment landscape.
"I think Lumikai still has an edge in gaming due to their deep sector expertise that other diversified VCs don't… Lumikai also has been much better and quicker at connecting us to larger gaming firms and gaming investors in the US and Japan when compared to diversified investors," said Ashwin Suresh, founder of Loco.
While the gaming sector faces regulatory challenges, Lumikai primarily focuses on investments in the casual and non-RMG segments. The fund recognizes the recent positive changes in the regulatory environment for RMG and remains open to investments in this sector as well.
"I think the regulatory environment in RMG has only started clearing up now… we are a diversified player, so we won't discount investments in RMG entirely," said Justin Shriram Keeling, founding general partner at Lumikai.
Lumikai's launch of Fund II highlights the continued growth and investment potential in India's gaming and media sectors. With its expertise, network, and commitment to the industry, Lumikai aims to contribute to the expansion and success of India's thriving gaming industry.