TLDR:
– Arkam Ventures, a digital tech-focused venture capital firm, has expanded its investment focus to include manufacturing and electric vehicle (EV) startups in addition to its existing sectors of fintech, skilling, software-as-a-service, logistics, and food agriculture.
– Arkam Ventures recently led a $6.3 million Series A funding round in custom manufacturing platform Karkhana.io, marking its first investment in the manufacturing space.
– Bala Srinivasa, managing director at Arkam Ventures, highlighted the challenges and opportunities in the manufacturing sector, emphasizing the need for digital platforms to address issues related to demand sourcing, capital, and capacity utilization.
– The ‘China Plus One’ strategy and rising domestic demand contribute to a favorable environment for manufacturing startups in India.
Digital tech-focused venture capital firm Arkam Ventures has expanded its investment focus to include manufacturing and electric vehicle (EV) startups. The firm’s second venture capital fund, which launched last year, has a multi-fund thesis that includes sectors connected by the digitization theme. In addition to manufacturing and EVs, the fund also focuses on fintech, skilling, software-as-a-service, logistics, and food agriculture.
Arkam Ventures recently made its first investment in the manufacturing sector, leading a $6.3 million Series A funding round in custom manufacturing platform Karkhana.io. The platform offers solutions for contract manufacturing, including product assembly and product localization. Bala Srinivasa, managing director at Arkam Ventures, highlighted the need for transparency, visibility, and higher quality in manufacturing, which can be achieved through technology. He emphasized that small businesses in the sector are looking to digital platforms to meet the increasing demand.
Srinivasa acknowledged the challenges faced by manufacturing startups, such as long gestation periods and barriers to entry. However, he also noted that customer stickiness tends to be higher in the manufacturing sector compared to other types of tech startups. He attributed this to the growing interest from investors and the ‘China Plus One’ strategy, which encourages companies to diversify their sourcing countries to reduce dependency on China. Srinivasa emphasized the importance of small Indian businesses becoming large manufacturing enterprises to keep pace with growing demand.
Overall, Arkam Ventures’ expansion into manufacturing and EV startups reflects the firm’s recognition of the potential in these sectors and its commitment to supporting innovative companies in driving digitization and growth. The firm’s investment in Karkhana.io highlights the importance of digital platforms in addressing the challenges faced by small businesses in the manufacturing sector, such as demand sourcing, capital, and capacity utilization. With the favorable environment for manufacturing startups in India, Arkam Ventures is well-positioned to identify and support promising companies in these sectors.
