Aavishkar eyes to close $75-mn Frontier Fund by Q3 of 2014

Set to take its impact investing model to Indonesia, Sri Lanka, Myanmar, Bangladesh and Pakistan

Aavishkar, a micro-finance fund, expects to raise $75 million for its Frontier Fund by the third quarter of 2014. The fund, to deployed south and south-east Asia, will be among a few India-focussed private equity funds going global.

E N Venkat, partner, Aavishkar Frontier Fund, said there was encouraging response and he was hopeful of tying up fund commitments by the third quarter of 2014.  “We have matured as an organisation and recognised our strengths and limitations regarding our work in India. The next logical extension is to look at emerging economies. With the Frontier Fund, we plan to take the Aavishkaar model of investing to neighbouring countries like Indonesia, Sri Lanka, Myanmar, Bangladesh and Pakistan,” the company said.

Aavishkar intends to invest in 300 start-ups across emerging economies, nurture entrepreneurial talent and promote enterprise-based development. The private equity funds aims to raise $1 billion over the next 10 years.

Aavishkaar has raised four funds over the past decade. It has $155 million under management and a portfolio of over 45 business ventures at various stages of development in areas like agriculture, education, energy, handicrafts, health, water and sanitation, technology for development, microfinance and financial inclusion.

Impact investing, putting money in ventures that affect society, accounted for 23 per cent of overall private equity transactions in India last year. This was spread over 80 deals worth $390 million, according to data from Unitus Capital, an advisory firm. Unitus expects a 30 per cent increase in impact investing in 2014.

Unitus added there was an uptick in farm businesses, healthcare and education and this coincided with increased capital flowing in from global investors into innovative Indian impact investments.