Consumer-focused venture capital (VC) firm Sauce.vc has marked the final close of its second “opportunities fund” at ₹750 Cr (about $82.5 Mn).

With the fund, the VC firm intends to double down on four to six high-growth startups from its portfolio. It intends to invest in the range of ₹220-250 Cr in portfolio startups like Hocco, The Whole Truth, Mokobara, Innovist, XYXX and Supertails.

Yash Dholakia, Partner at Sauce.vc, said that this strategy will help it build long-term partnerships with founders it has backed since the seed stage.

“This allows us to form a long term partnership with our founders who we have backed from seed stage, and also deploy larger capital without blind pool risk, and meet liquidity needs of LPs which are a shorter time frame (5-7 years) than the entire life cycle of a brand (10-12 years),” Dholakia told Inc42.

The firm launched the fund in early 2025 with a target corpus of ₹700 Cr with an intent to invest in follow-on funding rounds of its profitable, cash-flow-positive growth-stage bets where it already holds meaningful equity.

In 2023, Sauce raised its first continuity fund of ₹260 Cr to invest in six companies including XYXX and Supertails. Besides, it also operates three small early-stage funds for new bets, and separately raises larger “opportunity funds” to double down on winners from earlier funds.

With the close of the second opportunities fund, Sauce is now eyeing to launch its fourth early stage focussed fund by July 2026. Dholakia said that the VC firm is eyeing a total corpus of about ₹450 Cr for the fund and plans on backing 15 to 17 early stage D2C brands at the pre seed to pre Series A stage.

“We intend to keep our seed funds tightly sized and disciplined, with small initial cheques and significant reserves for follow-on investments. After that, breakout companies can be funded by future opportunities funds,” he added.

Founded in 2019 by Manu Chandra, Sauce primarily focusses on pre-seed, pre-revenue businesses, backing them early and working closely with founders through their zero-to-one journeys. It launched its first fund with a corpus of ₹60 Cr, which was largely backed by personal capital and close networks. The second fund stood at ₹158 Cr and supported 13 investments, while Fund III closed at ₹360 Cr in 2024.

The VC firm’s portfolio includes 31 startups largely operating in the D2C segment. Some of its early-stage bets include Hoovu, Postcard, Aroleap, Loopie, among others.

Earlier this month, the firm co-led protein supplement startup The Whole Truth’s $51 Mn Series D round. Sauce.vc invested about ₹150 Cr in the healthy snacking startup in the round.

The firm’s continued investments reflect strong optimism about India’s consumer market. According to Inc42, India’s consumer economy is rapidly evolving into the world’s second-largest, expected to grow from $2.4 Tn to $4.3 Tn by 2030. Key drivers include a projected $300 Bn+ D2C market by 2030 and a $1.93 Tn retail market, with significant growth stemming from Tier II and III cities.

This growth potential has also delivered strong exits for early-stage ecommerce investors, strengthening confidence in the sector’s growth potential. For instance, investors like SoftBank, Premji Invest, Schroders Capital, TPG Growth, among others, registered strong returns from FirstCry’s IPO in 2024. Meanwhile, late stage ecommerce startups like Curefoods, boAt, Purple Style Labs, among others, are also expected to go public soon, minting hefty returns for their backers and promoters.

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