Princeton Seeks to Pull $500 Million From WestBridge Capital

By Daniel Okafor

Princeton University wants to redeem an estimated $500 million from WestBridge Capital, and its exposure to the India-focused firm "could reduce to near zero in phases over the coming months," a person familiar with the matter told Moneycontrol. Six people confirmed the relationship between the storied investor and one of its anchor limited partners has soured.

WestBridge and Princeton did not respond to Moneycontrol's queries.

Why is Princeton pulling out?

The US university's concerns center on two things: weak performance in WestBridge's public-market portfolio and a lack of DPI, or distributions to paid-in capital. DPI measures how much cash LPs have received relative to what they put in. A higher DPI signals liquidity and raises the odds an LP re-ups in a future fund.

Princeton invests through the Princeton University Investment Company, or Princo, which managed a $42.3 billion endowment as of June 30, 2026. The tie runs deep. WestBridge co-founder and managing director Sumir Chadha graduated from Princeton in 1993 and briefly served as a trustee on the university's board.

"Princeton had chosen to support Sumir (Chadha) during their split from Sequoia Capital India and decided to become an LP in WestBridge," one of the people told Moneycontrol.

How bad is the listed portfolio?

WestBridge's public-market bets have delivered mixed performance, not a broad decline. But several large positions have taken real damage over the past year:

• InterGlobe Aviation, operator of IndiGo, fell roughly 20%. WestBridge held over 1.6% as of September 2026.
• India Shelter Finance, in which WestBridge and affiliate Aravali Investment Holdings together held about 46% as of June, dropped more than 30%.
• Freshworks trades near $15 a share, over 55% below its $36 IPO price from 2021. WestBridge has cut its stake from more than 10% in early 2023 to about 3% as of June 2026.
• Star Health trades near Rs 545, almost 40% under its Rs 900 IPO price. WestBridge holds about 40% through Safecrop Investments India LLP.

WestBridge has started a process to exit Star Health entirely. JP Morgan has emerged as preferred adviser for a stake sale. Moneycontrol earlier reported preliminary talks with strategic investors, including Japanese insurers. At current prices, a full exit could fetch WestBridge more than Rs 12,000 crore, or $1.3 billion. Final deal terms have not emerged.

What is WestBridge selling to fill the gap?

To offset a full Princeton withdrawal, WestBridge is looking to monetise stakes in Star Health, TransUnion CIBIL, DealShare and others, sources said.

The firm is already trimming listed holdings. Its PhysicsWallah stake fell to just over 5.3% as of September 2026, from just over 7% around the company's 2025 listing. It fully exited Aptus Value Housing Finance through block deals in 2025; annual-report disclosures show the holding reached zero by March 2026.

"While WestBridge is doubling down on existing companies like Third Wave Coffee and Rapido, it appears to be in a more fund-management and portfolio-management mode, with the pace of fresh investments slowing in recent months," one person told Moneycontrol.

That marks a shift for a firm that has straddled private and public markets with long-term positions in financial services, consumer internet, technology and healthcare. WestBridge has backed more than a dozen unicorns and taken PhysicsWallah, Meesho and Freshworks public. Its peers Peak XV Partners and Elevation have each taken at least 10 companies public. Across seven new-age IPOs in 2025, venture investors cashed out over $2 billion through offer-for-sale transactions while retaining stakes worth more than $10 billion, Moneycontrol reported earlier.

How could the withdrawal work?

WestBridge's funds totaled $7.3 billion as of December 2025. Its latest vehicle, raised in mid-2022, held $1.5 billion — its largest-ever commitment to India. The firm invests between $10 million and $500 million per company, with horizons of five to 25 years, against the five-to-seven-year norm among peers.

Its evergreen structure gives it a notional fund life of 20 years, with LPs able to seek liquidity after a five-year lock-in. Industry executives said a withdrawal could take several shapes: an annual redemption window, drawdowns across multiple windows, three to six months of advance notice, or a secondary sale to another investor, subject to transfer restrictions.

WestBridge has not publicly linked its portfolio moves to Princeton. The test ahead is whether asset sales can replace a founding backer's capital while the firm keeps enough dry powder for new deals.