Impact investment firm Caspian to invest up to Rs 500 cr in startups this year

Impact investment firm Caspian is planning to almost double its debt investments in startups to about ₹500 crore this fiscal year, with a key shift in focus towards ventures led or owned by women.

The Hyderabad-based investor, which presently has nearly ₹550 crore of funds available at its disposal, will also focus on ventures which offer products and services that are non-discretionary, like education, health, agri-business, clean energy, and microlending, which are amongst the least affected by the Covid-19 pandemic.

Caspian’s new investments dropped in the just-ended fiscal year to ₹344 crore, from ₹424 crore in 2019-20 and ₹392 crore the year prior, with barely five months of active operations amid the pandemic. Aggregately, it has invested about ₹2,000 crore as debt in 154 firms.

“We have raised tier-II capital of ₹57 crore at the end of last year from US-based International Development Finance Corporation and we now have sufficient liquidity of about ₹550 crore, both impact debt and venture debt put together,” managing director S Viswanatha Prasad said.

Besides planning to significantly increase debt investments during the current fiscal year, Caspian is also looking at equity investments of around ₹75-100 crore in 3-4 ventures at an average of ₹25-30 crore each, essentially in financial services and clean energy segments. “This year, Caspian will put a vital push as a category towards lending to women-owned and women-managed businesses or businesses into products and services focusing on women,” Prasad said.

Its target is to make around 40% of new investment in such businesses, up from around 10-12% cumulative to date.

Learning from experiences during the Covid-19 pandemic, the impact investor has also decided to invest majorly in ventures whose fortunes are not dependent on discretionary spending.

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