General Catalyst, a Silicon Valley venture capital firm, has acquired Venture Highway and plans to invest $1 billion in India.

Silicon Valley-based venture capital firm General Catalyst, known for backing global tech giants such as Airbnb, Snap, Canva, and Stripe, is set to acquire India-focused early-stage investor Venture Highway to expand its local presence. Venture Highway, founded by former WhatsApp business head Neeraj Arora, will be rebranded as General Catalyst India. This New Delhi-based firm has invested in unicorns like Meesho and Moglix. Arora, along with managing director Priya Mohan, will lead General Catalyst’s efforts in India.

This acquisition occurs amid a broader shift in the global venture capital industry, following the exuberance during the Covid years. Major VC funds like Sequoia Capital exited India last year, highlighting challenges tech-focused funds face in achieving exits and distributing returns to limited partners. The new Indian entity will be part of General Catalyst’s global fund, which is raising $6 billion, with the firm currently managing over $25 billion in assets worldwide.

For General Catalyst, which has invested in Indian startups like Cred, Spinny, and Uni, the acquisition signifies a formal entry into the country with a dedicated team. Last year, the firm also merged with Europe’s La Famiglia. Hemant Taneja, CEO and managing director of General Catalyst, mentioned in an interview that the firm plans to invest between $500 million to $1 billion in India, significantly more than before due to the newly established local team.

Taneja emphasized that General Catalyst’s global partnership will invest across the US, Europe, and India. The acquisition allows the firm to leverage Venture Highway’s expertise in serving founders at the seed stage. Mohan added that they will continue to work with their current portfolio companies and that there is no purchase of Venture Highway’s existing portfolio.

Arora explained that merging with General Catalyst allows them to participate more significantly in India’s venture ecosystem, which has seen a steady flow of exits through IPOs in recent years. He noted that the Indian startup ecosystem has matured, with more companies providing meaningful returns for investors.

Last October, Venture Highway sold part of its stake in Meesho to WestBridge Capital in a secondary sale. Arora highlighted that, unlike in the past where exits were sporadic, India now consistently returns capital to investors, signaling readiness for sustained growth.

Despite other global venture capital firms pulling back or slowing down in India recently, General Catalyst is not following the franchise model. Instead, they aim for a unified global partnership. This approach contrasts with other firms that create separate pools of capital and economics, which Taneja believes is not conducive to building a lasting institution.