International Finance Corporation (IFC), private equity fund manager VenturEast and and Bharatiya Yuva Shakti (BYST) Trust have launched a fund to provide financing to young Indian entrepreneurs. The fund, which will be managed by VenturEast is targeting a final close of $5 million. It has already garnered $2 million with an initial support of $700,000 from IFC. VenturEast is a fund with close to $300 million under management.
The fund will provide affordable financing and mentoring to young entrepreneurs who have sound business models. This is also a first micro-equity initiative to finance socially disadvantaged entrepreneurs.
The fund manager, VenturEast, claims to balance the concerns of multiple investors and partners while ensuring important social impacts at the grassroots level.
IFC is a member of the World Bank group. It aims at creating opportunities for individuals to escape poverty and fostering sustainable growth in developing countries. IFC had made investments of $16.2 billion in fiscal 2008 and had recently joined hands with the Gujarat government to develop a university campus to address higher education needs of rural youth.
BYST, set up in 1992, works with unemployed or underemployed individuals in the age group of 18-35 years, who have sustainable business ideas.
Aavishkaar Micro Venture Capital Fund is also in the similar space. It recently raised $11.3 million, and is targeting a $15 million corpus.