The Michael and Susan Dell Foundation (MSDF), one the world’s biggest philanthropic organisations, and an active impact investor in India, has earmarked an additional $50 million (about Rs 333 crore) towards investments in the country over the next three years.

The amount, which will be primarily used towards making direct investments in early-stage ventures, will be in addition to the impact investor’s existing vehicles, which includes its Delaware-registered, proprietary seed-stage fund —India Educational Investment Fund.

“A large part of the $50 million will go towards (funding) startups and this is also because, while we are an extremely active impact investor, we are increasingly finding that the venture capital space is struggling to get money and ventures in areas of our interest are even more starved,” Debasish Mitter, country director-India at MSDF .

The foundation has also backed two early-stage funds in the country as a limited partner —Unitus Seed Fund and social business incubator Villgro-launched Menterra Venture Advisors. “We are not getting enough of deals that we would like to do. We feel there is a tremendous fit between a venture philanthropist approach to seed funding and what the space needs… And what can be better than philanthropist organisations that aren’t shy to put its capital at stake in a venture philanthropic manner,” he said.

According to Mitter, MSDF, which focuses on backing earlystage ventures operating in the education, skills and financial inclusion segments, is looking to increase its offerings to ventures, which currently include grants, equity financing, debt and non-convertible debt offerings.

“We are willing to take whichever investment tool, which best supports the requirement of solving the business problems that we are getting to solve,” Mitter said. The developments come at a time when impact investing in India has remained largely stagnant, in terms of deal activity, over the last two years. According to data collated by Venture Intelligence, 2015 saw transactions worth $104 million spread over 57 deals, while 2014 saw investments worth $106 million across 49 transactions. The year 2016 has seen 14 transactions so far, amounting to $42 million.

Source: The Economic Times

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