Mumbai: Impact investing-focused Aavishkaar-Intellecap Group has raised $25 million (approximately Rs170 crore) in equity funding led by Triodos Investment Management, the investment arm of European lender Triodos Bank, and Shell Foundation, an independent charity established by the Shell Group.
Triodos has invested $15 million in the group and Shell has contributed $10 million.
Founded in 2002, the Aavishkaar-Intellecap Group offers range of financial products to entrepreneurs working to solve problems at the bottom of the pyramid, including equity funds, a venture debt vehicle, microfinance lending, investment banking services, consulting, research and access to global networks.
The group operates its equity funds business through Aavishkaar Venture Management Services; investment banking, consulting and research through Intellecap; extending working capital and business loans to small and medium enterprises through Intellecash, venture debt through Intellecap and microfinance lending through Arohan.
Across its various equity funds and debt businesses, the group has over $400 million in assets under management, with 2,500 team members across Asia, Africa and the Americas.
The investment will be infused in the group holding company to enable the group to consolidate and expand its initiatives and businesses across the globe.
Mint reported on 3 January that Aavishkaar Venture Management, the equity fund business, plans to raise up to $150 million to invest in Africa, as part of its plans to grow the group’s business overseas.
The Africa fund will be the second overseas-focused fund from the group. It will also be Aavishkaar’s seventh fund. Aavishkaar is currently raising a $75 million Frontier Fund, which will invest in South and South-East Asia, its first overseas fund.
The group will also use the capital raised for investing in its debt businesses—Intellecap, Intellecash and Arohan, said Vineet Rai, founder of Aavishkaar-Intellecap Group.
“The debt businesses will be raising funds to grow and we will be investing capital to keep a significant shareholding in these businesses. We are looking to raise around $50-75 million for the debt businesses in the next six months,” he said.
Capital will also be invested in building technology solutions and for talent acquisition, he added.
“We are building an ecosystem for impact investing and that means that you need to invest capital to bring in high quality of senior leadership, you need to bring in technology, you have to invest in incubating innovations that can be disruptive. All of this requires capital,” added Rai.
The fund-raising comes at a time when the group plans to increase its assets under management across equity and debt businesses to $3.5 billion by 2024.
Out of this, the group is targeting around $1.5 billion through the various equity funds that Aavishkaar manages and will raise going ahead, while the remaining $2 billion will come from the debt businesses, Mint reported on 3 January.
“India is at the centre of a global economic phenomenon: the emergence of private enterprises delivering public services such as affordable energy, healthcare, education or transportation on a national level. Yet many such enterprises are in their early stages and serve only a relatively small percentage of demand. Our long-standing partnership with the Aavishkaar-Intellecap Group enables foundations, investors, corporates and policymakers to accelerate the growth of these markets – by providing early-stage funding to the right innovators at the right time,” said Sam Parker, director at Shell Foundation.