IFC backs private equity funds in India that are facing rough weather

The problem is that most of these funds have under-performed: they have returned less than a fourth of this money, yielding single-digit returns for the portfolio

Nupur Garg faces a daunting task. As the head of the International Finance Corporation’s PE funds business in India, she leads a team that invests roughly $100 million every year in new private equity (PE) funds and also tracks the $700 million IFC has invested in 34 funds in India since 2006.
 

IFC had backed many first-time fund managers between 2006 and 2010, seeding two-thirds of the funds in the small-to-mid-market (less than $250 million each). A lot of capital flowed in during 2007-08. The industry took off and at its peak, there were over 200 fund managers.

  

The problem