Aavishkaar invests $5.4 mn in breakfast cereal maker Soulfull
Photo Credit: Abhijit Tambe/VCCircle

Impact investment firm Aavishkaar Venture Management Services Ltd has invested Rs 35 crore ($5.37 million) in Bangalore-based packaged foods startup Kottaram Agro Foods Pvt. Ltd, which makes breakfast cereals under the brand Soulfull, a company statement said.

Aavishkaar made the investment through its Aavishkaar Bharat Fund, the statement added.

“The tangential outcome of Soulfull products is the increasing demand of ancient grains that will address problems of marginal Indian farmers and reduce environmental stresses on land since these grains can grow in arid areas, are pest-resistant and need minimal fertilizers,” said Vineet Rai, managing director of Aavishkaar Venture Management Services.

Prashant Parameswaran, MD and chief executive officer of Kottaram Agro Foods, said the partnership with Aavishkaar will help Soulfull strengthen its product portfolio, accelerate marketing and expand its distribution reach to over 50,000 retail outlets in the next three years.

Incorporated in 2011, Kottaram Agro Foods manufactures and sells branded packaged food products such as breakfast cereals and instant mix.

The company’s total revenue stood at Rs 10.41 crore and registered a net loss of Rs 5.92 crore in the financial year through March 2017, according to VCCEdge, the data intelligence platform of VCCircle.

Aavishkaar Bharat Fund

The fund is the sixth by Aavishkaar Venture Management. In November 2017, the firm hit the first close at $95 million (Rs 620 crore) and is targeting to make the final close at $200 million.

Aavishkaar Bharat Fund made its debut investment in Utkarsh Micro Finance. Kottaram Agro Foods is its second investment.

The fund is targeting early-to-mid stage investment opportunities in sectors such as healthcare, agriculture, clean technology, education and financial inclusion.

Recent deals in the food sector

Earlier this week, ready-to-cook food startup Fingerlix raised Rs 8.5 crore ($1.3 million) from venture debt firm Alteria Capital.

In January, Morgan Stanley Private Equity Asia invested Rs 152 crore ($23 million) in Southern Health Foods, which markets its products under the brand ‘Manna Foods’.

In the same month, health foods startup True Elements raised Rs 5 crore ($788,500) in a pre-Series A funding round led by the RP-Sanjiv Goenka Group.

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