Private markets
Alternative Investment Funds
Venture, private equity, credit and hedge strategies — beyond the listed market.
AIFs pool capital from a small number of large investors into assets ordinary funds can't reach: startups, unlisted companies, private credit, real assets and hedge strategies. Minimum commitment is ₹1 crore, typically drawn down in installments.
Layer 5 of 6 in the access spectrum
How it works
Choose the category
Category I backs venture, SME and infrastructure; Category II holds private equity, credit and real estate; Category III runs hedge and long-short strategies.
Commit, then fund over time
You sign for a total commitment; the fund calls capital as it finds deals. Your money goes to work in tranches, not all at once.
Hold through the cycle
Value is created over years and returned as exits happen. The J-curve is real — early years can show paper losses before distributions begin.
Who this is for
UHNI and family-office allocations that can lock capital for years
Investors seeking exposure to venture, private equity or private credit
Portfolios large enough that a 7-year illiquid sleeve is a feature, not a risk
The three SEBI categories
Category I
Venture capital, angel, SME, social venture and infrastructure funds
Category II
Private equity, private debt/credit, real estate, fund of funds
Category III
Hedge funds, long-short and PIPE strategies
Good questions
Asked at almost every first meeting
The honest answers, before you even have to ask. Anything else — that's what the first conversation is for.
You sign for a total amount — say ₹1 crore — but the fund calls it in tranches as it finds deals, typically over two to four years. Each drawdown notice has a deadline, so the uncalled portion should stay liquid.
As the fund exits its investments — through sales, listings or refinancing — proceeds are distributed to investors. Most Category I and II funds run seven or more years; there is no redemption window in between.
Early years show fees and unrealized positions before any exits happen, so reported value often dips before it climbs. It is a structural feature of private-market investing, not necessarily a sign the fund is failing.
Plain-spoken risk
What can go wrong
Every instrument on this page is market-linked or carries its own constraints. You should know them before you commit — here they are, without the fine-print font size.
Capital is illiquid — locked in for the fund's life, often seven years or more.
Outcomes depend heavily on manager skill and deal selection; funds can lose money.
Concentrated holdings mean less diversification than public-market funds.
Alternative Investment Funds are high-risk, illiquid products suitable only for investors who meet regulatory minimums and can bear extended lock-ins and potential loss of capital. Returns are not guaranteed.
Wondering if AIF belongs in your plan?
That depends on your goals, horizon and what you already hold — exactly the conversation we start with.
Talk to us