Lightbox has returned about a third of its $100 million second fund to investors following a partial exit from cloud kitchen startup Rebel Foods and its exit from Embibe, an AI-edtech company, the founder of the venture capital firm said.

“We've returned 30% of the capital so far and it'll likely take another three to four years to realise the balance returns we aim for," Sandeep Murthy, founder and managing director of Lightbox India, told Mint. “Today, the companies are straightforward—Rebel, Furlenco, Droom and Bombay Shirt Company—all with well-understood business models."

According to Murthy, Lightbox’s second fund is expected to deliver a total return of 5x within three to four years. However, the DPI (distributions to paid-in capital ratio) will differ as returns are calculated after deductions such as management fees. The total returns from the second fund include the contribution from Lightbox’s exit from Embibe. Lightbox achieved a threefold return with a 35% internal rate of return (IRR) when Reliance Industries Ltd acquired its stake in Embibe in 2017.

Murthy told Mint in 2023 that 10 of Lightbox’s 14 portfolio companies in India are expected to achieve profitability soon. Today, furniture rental startup Furlenco, digital lending fintech platform Rupeek, and direct-to-consumer female wellness brand Nua have reached profitability, he said.

Nua reduced cash burn by over 50% by optimising costs such as logistics and ad spend, the company said. Murthy expects Rebel Foods, Droom, and Waycool to follow within six months.

Excerpts from an article published in Mint on January 28, 2024. Read the original article here.