Lumikai is a venture capital (VC) firm which supports gaming and interactive media firms. It announced the launch of its second fund, on Thursday, targeting a $50 million corpus from global investors.
Lumikai was founded in 2020 by Salone Sehgal and Justin Keeling. It invests in pre-seed to series A stage startups with cheque sizes ranging from $700,000 to $1.5 million. Some of its portfolio startups include Loco, Bombay Play, Studio Sirah, Eloelo, and Giga Fun Studios.
According to sources, the venture fund has already received nearly half of the fund corpus in an “oversubscribed first close” to date. Lumikai also stated that it has set up a dedicated $10M AIF (Alternate Investment Fund) for Indian LPs (limited partners) to attract domestic Rupee Capital. This will bring Lumikai’s total asset under management (AUM) to $100 million.
Some of the publicly listed investors in the fund include gaming giants of Japan – Mixi and Colopl, South Korean multi-billion-dollar conglomerates Krafton and Smilegate, Finland-based decacorn Supercell, and BSE-listed Nazara Technologies.
Other participants who contributed to this fundraise include Jeejeebhoys, KCT Group, DSP Kothari, and Sattva Group, as well as high-net-worth individuals such as Take-Two Interactive CEO Ben Feder, Napster CEO Jon Vlassopulos, Gulf Islamic Investments founder Pankaj Gupta, and Nodwin Gaming founder Akshat Rathee.
According to Salone Sehgal, the capital will be used primarily for new investments and they currently have three new deals in the pipeline.
With the new fund, Lumikai will be investing across key areas like gaming content, original IP from Indian studios, user-generated content platforms and creator economy; and tools, technology and infrastructure, Keeling said. Lumikai is also looking at companies that are leveraging “systems of play, applied game mechanics and leverage interactivity to disrupt value chains across legacy media, and sectors such as fintech and edtech” as well as startups working on cutting-edge technologies such as mixed reality, generative AI, virtual identities, and edge computing among others.
Justin Keeling, in his statement said, “We’re expecting India over the next three to four years to become more of a net exporter of gaming content.”
According to Niko Partners, a market research and consulting firm, “This fund comes at a time when India has been dubbed as the fastest-growing games market in Asia, with its mobile and PC gaming revenue projected to reach $704.5 million in 2022.” The firm further added, “This is set to grow at a five-year compound annual growth rate of 21.1 percent to touch $1.4 billion in 2026. This does not include revenue generated by real money games. About 34 percent of gamers in India spent money on non-RMG titles in 2022.”
According to a Lumikai report, “India’s overall gaming industry revenues increased from $2 billion in FY21 to $2.6 billion in FY22 and is expected to expand at a compound annual growth rate of 27 percent to $8.6 billion in FY27.”
