First Cheque to invest in 15-20 startups over next 18 months

First Cheque, an early-stage venture capital firm, has set its sights on investing in 15 to 20 startups over the next 18 months as part of its third investment cohort.

The firm, operating under the umbrella of India Quotient Venture Capital since 2018, primarily focuses on pre-seed investments.

The average size of the initial investments, or “first cheque,” will be up to $500,000 per startup. This new cohort follows the close of First Cheque’s second fund at Rs 38 crore in 2022.

Shifts in investment strategy

Kanika Agarrwal, a partner at India Quotient, shared that First Cheque is adjusting its approach to better support founders in the pre-seed market.

"Over the past few years, we have realised that the pre-seed market offers many more options beyond what we were providing for these pre-seed founders to raise funds. There are angel investors, family offices that are quite active, and micro VCs that are doing a good job," Agarrwal said.

To leverage these opportunities, First Cheque plans to work alongside other investors, such as angel investors and micro-VCs, allowing it to participate in larger funding rounds.

The collaboration aims to provide more substantial support to early-stage startups by pooling resources from multiple investors.

Focus on direct-to-consumer startups

While First Cheque follows a sector-agnostic investment approach, the firm has shown a strong interest in backing direct-to-consumer (D2C) brands for the upcoming cohort. Agarrwal highlighted their interest in discovering unique and differentiated D2C brands.

"There are a lot of D2C brands, but that also means there are many 'me too' brands. So, what we're trying to find are truly differentiated ones in categories that are completely empty," she noted.

The firm is particularly interested in brands for kids, sports, white goods, and those targeting Gen Z consumers.

Track record of investments

Since its inception, First Cheque has invested in more than 130 startups across various industries. Notable companies in its portfolio include jewellery brand Giva, SaaS platform Rocketlane, career development platform Seekho, fleet management company Fleetx, water supplier DrinkPrime, and generative AI startup Simplismart. 

With its updated strategy and emphasis on D2C brands, First Cheque aims to support founders who are introducing new categories, reshaping existing markets, or creating products that fulfill unmet needs.

"We are looking to back passionate founders, new category creators, those turning chaos into order, or those replacing everyday items or even building something the world hasn’t seen yet," said Gagan Goyal, another partner at India Quotient.