Social impact investment firm Unitus Ventures (formerly Unitus Seed Fund) on Monday said it has marked the first close of its second fund at Rs 100 crore ($15 million), by raising money from investors including Michael & Susan Dell Foundation and Microsoft co-founder Bill Gates. The fund has a target corpus of Rs 300 crore ($46 million).
Other investors in the second fund include Hemendra Kothari, chairman DSP BlackRock; Ravi Venkatesan, chairman of Bank of Baroda; and Padma Chandrasekaran, founder-member of Sify and angel investor.
The second fund has already made six investments. It has invested in, among others, Awign, a tech platform for businesses to execute tasks; Predible, cloud-based AI-driven solution for radiology; Utter, a chatbot-based learning platform for digital blue-collar workers; and i3 Systems, a data-centric health insurance underwriting and claims firm.
VCCircle reported last year that Unitus had struck four deals from its second fund even before its first close.
The fund will continue to focus on healthcare and education, besides fin-tech.
“With less than 10% of early-stage venture-capital funding going to healthcare and education, there is a scarcity of capital for good companies in these sectors. We are one of the very few investors that have dedicated a majority of their funds towards these sectors which are so critical for the growth and health of India,†said Will Poole, co-founder and managing partner at Unitus.
Last year, Unitus had hired Milind Shah, former managing director of Medtronic India, as healthcare venture partner to spearhead its investments in healthcare startups.
The fund’s investment ticket size will increase to Rs 5 crore. It aims to invest in 20 to 30 startups and reserve capital for follow-on investments for some companies.
The first fund, which had mobilised $23 million, made 23 investments including in health technology developer UE LifeSciences, microlending platform Milaap, ed-tech startup Curiositi, and online marketplace for handlooms and handicrafts GoCoop.
The first fund has begun returning capital to investors from secondary exits in after-school math-learning startup Cuemath and two other acquisitions. Overall, Unitus’s 14 active investees have already directly impacted over 1.2 million low-income lives across 21 states in India, displaying a 102% growth in 2017, the statement said.
Social impact investment
According to a report by consulting firm McKinsey, social impact funds had invested over $1 billion (Rs 6,400 crore) in India for the second consecutive year in 2016 (the latest year for which data are available) – seeing a jump in the average deal size, but the volumes remained flat.
The total value of social impact investments between 2010 and 2016 was $5.2 billion. The report added that there were over 50 active social impact funds and the segment had the potential to grow 20-25% per year to touch $6-8 billion by 2025.
Other notable social impact investment firms in India include Aavishkaar Venture Management, Omidyar Network, Acumen, Accion International and LGT Venture Philanthropy.
Late last year, Aavishkaar said it had hit the first close of the Aavishkaar Bharat Fund at Rs 594 crore ($92 million) and that it had received commitments that would take it close to Rs 620 crore ($95 million).