Agriculture and food-focussed investment firm Pioneering Ventures has launched an impact fund that aims to raise $50-70 million (Rs 346-485 crore) and invest mainly in Indian companies.
The development comes nearly one-and-a-half years after VCCircle reported in late 2017 that the Zurich-based firm was looking to float an India-focussed agriculture fund.
The Rural India Impact Fund, which is based in Mauritius, will look to raise capital from institutional investors that seek to co-invest in the investment firm’s portfolio of growth companies at the same terms as the promoters, according to a Pioneering Ventures document.
The Economic Times, which first reported the development, said Limited Partners (LPs) in the fund so far largely include high-net-worth individuals (HNIs) and family funds from Europe.
The report also said that the entire corpus will be put into Pioneering’s existing portfolio companies.
Pioneering Ventures has established four ventures -- frozen juice processor Citrus Processing India Pvt. Ltd, fruits and vegetables supply chain FarmLink Agri Distribution and Market Linkage Pvt. Ltd, integrated healthy dairy company MilkLane Dairy Services Pvt. Ltd and branded banana producer Desai Fruits and Vegetables Pvt. Ltd. Each of its ventures has a holding company abroad which invests directly in operating firms in India.
The combined revenue of the four companies in the year ended 31 March 2019 was $40 million; Pioneering expects this to touch $90 million in the current fiscal year.
The investment firm will also incubate three ventures within the next 12 months. They are last-mile sales and distribution platform DistriCo, land development fund GrowCo and financial services provider to the underserved community Samaaru.
Pioneering Ventures was founded in in 2004 by Ron Pal as Pal & Partners with a focus on tracking merger and acquisition opportunities for Swiss and German SMEs going to Asia. In 2009, the firm opened its branch in India. The same year, Pablo Erat joined the firm as project CEO to lead the incubation of Citrus International, an orange juice concentrate manufacturer.
Pal & Partners was renamed as P&P Entrepreneurial Services in 2014 and as Pioneering Ventures in 2016.
Apart from Pioneering, a few other investment firms are also looking to back agri-tech ventures in India.
Earlier this year, agri-tech-focused impact investor Omnivore Capital Management Advisors Pvt. Ltd marked the final close of its second fund at $97 million (Rs 679 crore), overshooting the initial target of $75 million.
Omnivore raised a bulk of the capital from foreign LPs. In an interaction with VCCircle, Omnivore managing partner Mark Kahn had said the impact investor could have raised the entire money from domestic investors if it wanted to, but the fund had already received heavy demand from foreign LPs.