Elevar Equity, an impact investor, is looking to raise its third fund with a target corpus of $75 million by end-2014. Elevar, one of the early backers of well-known microfinance companies including SKS Microfinance and Ujjivan Financial Services, is understood to have already started the process to raise its third fund and has received commitments from two large global investors.
Impact investments seek to solve social or environmental challenges while generating financial profit.
Senior private equity fund managers focussing on impact investing indicated that Omidyar Network, founded by eBay founder Pierre Omidyar, has already committed to Elevar's next fund, after being an investor in the second fund. Legatum, another global investor, had committed its resources to the second fund and its not yet sure, if there will be a follow-on from them. In addition to Omidyar, US-based blue-chip company Family Office is expected to be a key investor in Elevar's third fund.
Elevar had raised its second fund of $70 million in 2010 and is understood to have stopped fresh investments from that corpus and is preserving resources for follow-on investments. The management of Elevar Equity declined comment on the plans to raise its next fund.
Elevar was founded by Chris Brookfield, Maya Chorengel, Sandeep Farias and Johanna Posada and is one of the most active global investors in innovative companies delivering market-based solutions to foster economic development for poor communities. Elevar takes an equity exposure of up to $7 million through the life of the company. As and when Elevar raises its next fund, it will add heft to a small group of impact investment funds in India including Omidyar Network, Unitus Impact, Omnivore, among a few others, who together manage around $300 million of funds for this segment.
Since 2006, Elevar has managed two private equity funds totalling $94 million and has backed 16 companies at various stages of their growth. Elevar's portfolio companies have served close to 11 million households and have mobilised over $4 billion in equity and debt capital for targeted communities.
Elevar Equity-II, which is currently being invested from, follows the Unitus Equity Fund - one of the most successful microfinance equity funds to date. Through both the funds, the Elevar team has led Series A investments in leading microfinance institutions such as SKS Microfinance, Ujjivan, Grama Vidiyal, Madura Microfinance and Swadhaar.
Elevar has also made two non-financial services investments - Moksha-Yug Access (focused on rural supply chains) and Comat Technologies (delivering government service to rural communities).
MAKING AN IMPACT
* Elevar set to raise its third fund with a corpus $75 mn
* eBay founder Pierre Omidyar set to repose faith for the second time
* Elevar was among early investors in SKS Microfinance, Ujjivan and Moksha Yug
* In addition to Elevar, Unitus Impact, Omnivore, Omidyar are the other noted impact investors in India with a total corpus of $300 million