Key Takeaways
- • Transition VC closed its second fund at ₹1,500 Cr ($155+ Mn) targeting 20+ investments of $2-5 Mn each in engineering-led deeptech startups across energy transition, advanced manufacturing, and industrial technology over four years.
- • Fund I exceeded expectations with full deployment of ₹723 Cr (vs. ₹400 Cr target), generating 57% IRR and 3X MOIC within three years across 17 portfolio companies including CIMware, HYDGEN, and Dynolt.
- • Fund II expands investment thesis beyond cleantech to include advanced manufacturing, semiconductors, nuclear energy, geothermal technologies, and next-generation energy infrastructure while maintaining focus on technically feasible startups with early commercial traction.
- • Deployment of Fund II commences in Q3 FY27, positioning Transition VC amid broader institutional capital acceleration into industrial deeptech—evidenced by Lightrock's concurrent $500 Mn Accelerate7 fund targeting growth-stage energy investments across South Asia, Southeast Asia, and Sub-Saharan Africa.
Summary
Transition VC, a Bengaluru-based venture capital firm specializing in energy transition investments, has launched its second institutional fund with a target corpus of ₹1,500 Cr (approximately $155 million). The fund will deploy capital across engineering-led startups operating in energy transition, advanced manufacturing, and industrial deeptech sectors, with planned ticket sizes of $2-5 million per company across a portfolio of 20+ investments over the next four years.
The fund launch is grounded in the exceptional performance of Transition VC's inaugural fund, which closed at ₹723 Cr—substantially exceeding its initial ₹400 Cr target. Fund I achieved full deployment and delivered a 57% internal rate of return (IRR) with a 3X multiple on invested capital (MOIC) achieved within three years of the fund's inception. The portfolio comprised 17 companies including notable deeptech ventures such as CIMware, Comminent, Matel, EMO, HYDGEN, Dynolt, and Promethean, with typical cheque sizes ranging from $500,000 to $1 million.
Fund II represents a strategic expansion of Transition VC's investment mandate. While maintaining its core focus on energy transition startups—a segment that drove Fund I's performance across electric mobility, green hydrogen, energy storage, and climate technology—the firm will now selectively pursue opportunities in advanced manufacturing, application engineering, semiconductors, nuclear energy, geothermal technologies, and next-generation energy infrastructure. The strategy continues to target startups demonstrating technical feasibility and early commercial traction without yet achieving scaled product-market fit, positioning the fund to participate in the value creation phase of industrial deeptech maturation.
Deployment of Fund II capital will commence in the third quarter of fiscal year 2027. The fund launch reflects accelerating institutional investor appetite for industrial deeptech, evidenced by concurrent activity from larger pools of capital; PE firm Lightrock unveiled a $500 million energy-focused fund, Accelerate7, targeting growth-stage investments across South Asia, Southeast Asia, and Sub-Saharan Africa during the same period.
The fund launch is grounded in the exceptional performance of Transition VC's inaugural fund, which closed at ₹723 Cr—substantially exceeding its initial ₹400 Cr target. Fund I achieved full deployment and delivered a 57% internal rate of return (IRR) with a 3X multiple on invested capital (MOIC) achieved within three years of the fund's inception. The portfolio comprised 17 companies including notable deeptech ventures such as CIMware, Comminent, Matel, EMO, HYDGEN, Dynolt, and Promethean, with typical cheque sizes ranging from $500,000 to $1 million.
Fund II represents a strategic expansion of Transition VC's investment mandate. While maintaining its core focus on energy transition startups—a segment that drove Fund I's performance across electric mobility, green hydrogen, energy storage, and climate technology—the firm will now selectively pursue opportunities in advanced manufacturing, application engineering, semiconductors, nuclear energy, geothermal technologies, and next-generation energy infrastructure. The strategy continues to target startups demonstrating technical feasibility and early commercial traction without yet achieving scaled product-market fit, positioning the fund to participate in the value creation phase of industrial deeptech maturation.
Deployment of Fund II capital will commence in the third quarter of fiscal year 2027. The fund launch reflects accelerating institutional investor appetite for industrial deeptech, evidenced by concurrent activity from larger pools of capital; PE firm Lightrock unveiled a $500 million energy-focused fund, Accelerate7, targeting growth-stage investments across South Asia, Southeast Asia, and Sub-Saharan Africa during the same period.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.