Unitus Seed Fund (USF) has invested an undisclosed amount in Bangalore-based vocational skills training company iSTAR Skill Development Pvt Ltd, which provides additional skills training to unemployed graduates to make them employable in the BFSI and the ITeS sectors, according to a blog post.
Although the investment amount is not known, USF typically makes an initial investment of $50,000-$100,000 (Rs 27-54 lakh) in a portfolio firm. For larger seed rounds, it follows a co-investment model.
This is the first institutional capital raised by iSTAR, which was part of the IIM-Ahmedabad associated accelerator CIIE and previously got the backing of National Skill Development Corporation of India.
The company was set up in 2009 by Surga Thilakan and Sreeram Vaidyanathan, both graduates from IIM-Ahmedabad. Prior to starting iSTAR, Thilakan was working with the global investment bank Goldman Sachs while Vaidyanathan worked with the global technology behemoth Microsoft.
iSTAR partners with colleges to equip students with specific skillsets required for business and commerce graduates to be employment-ready immediately after graduation. Additionally, it provides career counselling and job placement support to students to accelerate their job search process. It started its first iLAB programme in December 2011 with 300 students and as of April 2013, claims to have trained over 2,500 students in six Bangalore colleges.
In the next five years, iSTAR expects to train over 140,000 students across India, a vast majority of them coming from low-income families.
USF, a part of the impact investment organisation Unitus, was co-founded by international early-stage investors and entrepreneurs Dave Richards and Will Poole. Last year, the fund made five investments in India including Hippocampus Learning Centres (improving learning outcome for children in rural India), Bodhicrew Services (skill development for those working in the unorganised sector), Milaap Social Ventures (online platform providing microloans to India’s working poor), Villgro Innovation Marketing (a rural distribution system improving the productivity of small farmers) and MadRat Games (a company developing educational/social games and apps). The fund is looking to make 10 new investments in 2013.
In January this year, it secured over $8 million in investment commitment from Vinod Khosla (founder of Khosla Ventures and Khosla Impact), 500 Startups, Mike Murray (co-founder of Unitus Labs), Jeff Clark and Bob Gay (Bain Capital).
(Edited by Sanghamitra Mandal)
