Impact investment funds for agri-focused social ventures in India

By Kirti Punia|27th Jul 2013
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Agriculture remains the source of livelihood for approximately 65% of Indian population till date. Agriculture has been a dominant sector in Indian economic growth and still remains a major contributor to India’s GDP. The importance and impact that agriculture has in India’s economy can’t be debated. The need of innovation and investments in the sector are also obvious and Government of India had allowed 100% FDI under automatic route in storage and warehousing and also for the development of seeds.

The social entrepreneurship eco-system is on a growth path but is still very nascent in India. With the wave of social entrepreneurship flowing across various sectors of social impact, agriculture sector is not left untouched too. Innovative social enterprises are coming up which are focusing on the problems and needs of farmers. With very few impact investment funds in India, there are even fewer, which have invested in the agriculture sector.


Impact investment as described by Planning Commission of India goes as – Investments in businesses and social ventures with the intention to generate measurable social and environmental impact alongside a financial return and which target a range of returns from below market to market rate. Impact investing is based on the conviction that such investments play a crucial role in addressing social and environmental challenges.

Here are 6 of those impact investment funds who have invested in agriculture focused social enterprises:

Aavishkaar – Aavishkaar is an early stage social impact fund in India that invests in early stage social entrepreneurial ventures which deliver commercial returns and bring about significant efficiencies and developmental impact to rural and underserved communities. Aavishkaar has invested in INI farms and Zameen, both of which are focused on creating opportunities in the agriculture sector for lower segments of society.

Acumen – Acumen is a non-profit global venture fund that uses social entrepreneurial approaches to tackle poverty. It raises charitable donations to invest in companies and ideas that are helping in improving the lives of the poor. Headquartered in New York, Acumen has invested a total of USD 83 million of which USD 20.5 million is invested in agriculture worldwide. USD 3 million is invested in 2 agriculture focused social enterprises in India – GEWP (Global Easy Water Products) and BASIX Krishi.

Ankur Capital – Ankur Capital is a social venture fund that invests in start-ups that impact low income communities in India. They provide financial and technical support to create sustainable and scalable social ventures. They have made an investment in CropIn Technology Solutions Pvt. Ltd.

Aspada Advisors – They provide early stage risk capital to businesses in India that are focused on expanding market access, improving livelihoods and creating employment opportunities in under served communities. Aspada Capital Advisors provide investment advice and portfolio oversight to the SONG Fund in India. Two agri-focused social ventures which they have invested in are LEAF and SV Agri.

Khosla Impact Fund – Khosla Impact fund invests in social ventures solving challenging, socio-economic problems through application of science, technology, and design or through creative business models. Out of 6 investments made by the fund, two have been made in the agriculture sector – MYA (MokshaYug Access) and Driptech.

Omnivore Capital – Omnivore Capital is an early stage venture capital fund backed by Godrej Agrovet Ltd. Omnivore Capital has invested INR 5 crore in agri-tech venture Frontal Rain Technologies Pvt. Ltd.

 

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