MICROCAPITAL BRIEF: Nine Indian Impact Investment Companies Forming “Indian Impact Investor Council”

Nine companies that specialize in impact investment reportedly will be establishing the “Indian Impact Investor Council” (IIIC) to establish guidelines helping investment companies in India regulate their efforts to meet social goals. These companies include Aavishkaar of India, which specializes in impact investments in rural initiatives; US-based Omidyar Network, which funds companies engaged in economic development initiatives; Elevar Equity, which was funded by US-based Unitus and finances initiatives targeted at “large, socially coherent but disconnected groups”; and India-based Unilazer Ventures, which offers funding and business advice to startups engaged in economic development.

IIIC will seek to create measures to promote the effectiveness of impact investing in the country and enforce compliance with these measures among its members. These will include rules determining which sectors qualify to receive impact investments, the duration of holding periods and a standard formula for calculating returns on impact investments. The other five companies to join IIIC have not been announced.

IIIC reportedly expects to have approximately 30 members by the end of 2013. The regional head of advisory services for the World Bank Group’s International Finance Corporation (IFC), Anil Sinha, reportedly noted that IFC will likely join the council.

According to India-based Venture Intelligence, which collects data on venture capital (VC) investments, VC funds in India have made approximately 109 investments in social businesses (excluding microfinance institutions) in India to date totaling approximately INR 20 trillion (USD 363 million).

By Makai McClintock, Research Associate

About Unitus
Unitus is a nonprofit organization with headquarters in the US and India that was set up in 2001 as Unitus Incorporated. Its aim is to reduce poverty via economic self-empowerment whereas Unitus Incorporated was more narrowly focused on providing funding and consulting services to microfinance institutions. As of 2010, Unitus worked with 22 partner microfinance institutions serving approximately 12 million clients. At that time Unitus reported total assets of approximately USD 9 million.

About International Finance Corporation (IFC)
A member of the US-based World Bank Group, the International Finance Corporation (IFC) offers loans, equity investments, advisory services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. As of 2011, IFC has 182 member countries, total assets of USD 68.5 billion and USD 12.2 billion mobilized to 518 projects.

About Aavishkaar Venture Management (AVM)
AVM is a Mumbai-based venture capital firm that seeks to enhance economic opportunities in rural India. AVM’s total assets under management has grown from under USD 20 million in 2002 to approximately USD 100 million in 2011. Aavishkaar has made a total of 22 investments in a variety of sectors as of September 2011.

About Elevar Equity
Elevar Equity is headquartered in Bangalore with offices in Seattle and San Francisco. The organization is focused on making investments in development-focused ventures in India, Latin America and Southeast Asia.

Sources and Additional Resources

India Times Article, “Now, a Regulatory Body to Set Norms for Impact Investment,” http://articles.economictimes.indiatimes.com/2013-05-08/news/39117121_1_vc-investments-vc-funds-vineet-rai

MicroCapital. March 19, 2013, “MICROFINANCE PAPER WRAP-UP: “Perspectives on Progress: The Impact Investor Survey,” https://www.microcapital.org/microfinance-paper-wrap-up-perspectives-on-progress-the-impact-investor-survey-by-yasemin-saltuk-published-by-jp-morgan-and-the-global-impact-investing-network-giin/

MicroCapital. February 26, 2013, “MICROFINANCE EVENT: Association of the Luxembourg Fund Industry (ALFI), LuxFLAG Host “Responsible Investing Conference,” May 15, 2013, Luxembourg,” https://www.microcapital.org/microfinance-event-association-of-the-luxembourg-fund-industry-alfi-luxflag-host-responsible-investing-conference-may-15-2013-luxembourg/

MicroCapital. January 21, 2013, “MICROFINANCE EVENT: Information Management Network’s Spring Investment Series “Impact Investing Summit,” March 14-15, 2013, Huntington Beach, California, USA,” https://www.microcapital.org/microfinance-event-information-management-networks-spring-investment-series-impact-investing-summit-march-14-15-2013-huntington-beach-california-usa/

MicroCapital. April 13, 2011, “MICROCAPITAL BRIEF: “Principles for Investors in Inclusive Finance” (PIIF) Created as Separate Work Stream Within United Nations’ Principles for Responsible Investment (PRI); CGAP (Consultative Group to Assist the Poor), Global Impact Investing Network (GIIN) Standards Observed,” https://www.microcapital.org/microcapital-brief-“principles-for-investors-in-inclusive-finance”-piif-created-as-separate-work-stream-within-united-nations’-principles-for-responsible-investment-pri-c/

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