Shubham Housing Development Finance raises $7.8M from Elevar, Helion, others
Gurgaon-based Shubham Housing Development Finance Company Pvt Ltd has raised $7.8 million (Rs 43.2 crore) from four investors – Elevar Equity Advisors, Helion Advisors, ACCION and Saama Capital, according to sources.
Shubham essentially focuses on the urban low-income and informal income families, and facilitates home loans and home improvement loans for them. The company’s operating model seeks to transcend document-based underwriting and follows an interview-based approach to understand a customer’s income and expense flows, says the company website.
A borrower can take a home loan up to Rs 10 lakh while the maximum amount lent for home improvement is Rs 5 lakh.
“The deal was struck in August where each of the four investors brought in around $1.94 million in the company to pick an undisclosed stake,” said a source privy to the transaction.
According to another source, the deal involves a mix of equity shares and compulsorily convertible preference shares.
Separate e-mail queries sent to the investors and the company did not elicit any response till the time of posting this news. However, the company's website now lists all these four as investors.
Elevar Equity Advisors provides equity capital to entrepreneurs and high-growth microfinance institutions in emerging countries. The company also invests in banking & financial services, education and healthcare from its Unitus Equity Fund II.
Helion invested through Helion Venture Fund II. This is the third investment by the fund in CY 2012, the other two being R&R Salons and India World Technologies. Shubham also raised around $2 million from Elevar Equity and Helion Venture Partners around two years ago.
Frontier Investments Group, a fund managed by ACCION Technical Advisors India, focuses on firms involved in financial inclusion. It provides early and growth-stage capital to technology, distribution and new products related to the microfinance sector.
Saama Capital II is an India-focused venture capital fund and the independent successor fund to SVB India Capital Partners I, according to the company website. The fund house has been investing in Indian companies since 2006 with diversification across investment stages and sectors. Its portfolio includes names like Tutorvista, Naaptol, One97 Communications, iYogi, Shriram EPC, Sula Wines, Shaadi.com and Genesis Colors.
Other key names in the similar space as Shubham include Spandana Sphoorty, Share Microfinance, Bandhan Financial Services and Asmitha Microfinance. However, Spandana, Share and Asmitha have merged in FY 2011-12. Shubham also has an operational tie-up with MFI Ujjivan, NGO Saath and technology service provider OSource.
(Edited by Sanghamitra Mandal)
Elevar Equity Advisors Pvt. Ltd. is an investment management company. It provides equity capital to entrepreneurs, high-growth microfinance institutions or institutions delivering services and products to these communities in emerging countries. It targets growth oriented and promising microfinance institutions in India, South East Asia and Latin America. It also invests in companies providing affordable, commercial and scalable adjacent services. Its network includes commercial and social fund investors, upstream capital market players, social entrepreneurs and local communities. The company was founded in 2008 and is based in Washington, United States of America with additional office in Bangalore, India.
Shubham Housing Development Finance Company Pvt. Ltd. is engaged in providing home loans and home improvement loans to customers who would normally fall outside the ambit of traditional lending institutions. The company was founded in 2010 and is based in Gurgaon, Haryana.
Helion Venture Partners LLC is a venture capital firm with $605 million asset under management. It provides capital to companies under early stage and expansion stage operating in India. The firm seeks to invest in technology-powered and consumer service businesses in sectors like outsourcing, internet, mobile, technology products, retail services, education and financial services. It seeks to invest between $2 million and $10 million. The firm also participates in future rounds of financing in syndication with other venture partners. The company was founded in 2006 and is based in Mauritius.
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