Redmond, Wash. (PRWEB) May 18, 2006
Unitus Equity Fund, L.P. (UEF), a private equity fund formed by Unitus, a nonprofit organization which creates innovative solutions to global poverty, and the Michael & Susan Dell Foundation (MSDF) today announced they will invest in Ujjivan Financial Services Private Limited, a newly-formed microfinance institution (MFI) with a vision to reach the poor in major cities throughout India. The UEF and MSDF join Bellwether Microfinance Fund, which had earlier invested in Ujjivan. The UEF is chartered to make direct equity investments in high-growth MFIs in Asia and Latin America, and will have a 24 percent stake in Ujjivan’s ownership, with MSDF and Bellwether at 13.8 percent and 12.6 percent, respectively. This investment will provide Ujjivan the capital to help reach more than 600,000 borrowers by 2011.
Ujjivan, based in Bangalore, India, is currently focused on providing financial services to the economically active urban poor. Microfinance in India is still mainly a rural phenomenon with only a handful of MFIs providing microfinance services to the urban poor. Ujjivan fills this gap with a mixed product offering targeted at urban, poor women.
Unitus President and CEO Geoff Davis said, “I’m delighted to welcome Ujjivan as Unitus’s ninth global MFI partner. The core strength of Ujjivan lies in its strong, experienced and visionary leadership team, which has over 60 years’ collective experience across commercial banking, microfinance, development and technology. By backing startup MFIs such as Ujjivan, we support innovation in the urban microfinance market. Working with Ujjivan from a very early stage to help them reach their goals will be a challenging but truly rewarding experience for Unitus.”
“Microfinance is a key program area for the foundation in India, and we're specifically focused on extending the proven success of microfinance in rural areas to urban markets,” said Janet Mountain, executive director of MSDF. “We invested in Ujjivan because of its support of urban micro-entrepreneurs, and we feel confident this effort will help the families of India long term by providing them with the financial means to improve the welfare and education of their children."
Added Viswanatha Prasad, Fund Manager, Bellwether Microfinance Fund, “Bellwether is delighted to welcome UEF and MSDF as investors in Ujjivan. Our combined resources will strengthen Ujjivan’s capital and capacity, and help Ujjivan realize its vision of creating a better life for a vast section of our community.”
“We are proud to formally join the Unitus and MSDF families, having been involved with them for some time,” said Samit Ghosh, CEO, Ujjivan. “We are at a stage when our business is ready to take off, and with this investment we have the financial and strategic support to grow Ujjivan so we can reach more of India’s poor. Ujjivan means a better life, and that is our true focus. We provide financial services for our customers to enable them to be free of poverty within five years of starting their relationship with us.”
Ujjivan commenced operations as a non-banking financial company in November 2005. It provides financial services to the economically active poor in India by combining successful models in microfinance with the technologies and efficiencies of modern retail banking. Through in-depth market research, Ujjivan has created a range of diverse financial products for poor urban women in India. While currently focusing on Bangalore, it expects to expand nationally and provide microfinance to more than 600,000 clients by 2011. Additional key Ujjivan investors include K. R. Ramamoorthy, Samit Ghosh, Nucleus Software, Ravi Bahl, Jaithirth Rao, and Ashok Vaswani. For more information about Ujjivan, please visit http://www.ujjivan.com.
Unitus, Inc. is a nonprofit organization creating innovative solutions to global poverty using a venture capital approach. Unitus dramatically accelerates the growth of microfinance institutions (MFIs) and demonstrates that many MFIs can be run as profitable, large-scale, poverty-focused businesses with links to formal capital markets. As of May 2006, Unitus had nine MFI partners worldwide serving more than 679,000 poor clients. By 2015 Unitus’s MFI partners plan to reach 10 million clients in India alone. Based in Redmond, WA, USA, and Bangalore, India, Unitus relies on innovative financial instruments and the financial resources of like-minded individuals and foundations to fulfill its mission. Unitus received the 2006 Fast Company Social Capitalist Award for taking an innovative, business-minded approach to alleviating global poverty. For more information about Unitus, please visit http://www.unitus.com.
About the Michael & Susan Dell Foundation
The Michael & Susan Dell Foundation (http://www.msdf.org) was established in 1999 by the Dell family to improve outcomes for children living in urban poverty. Based in Austin, Texas, the Foundation funds programs that foster and improve education, health and safety for children around the world. With an endowment of more than $1 billion, the Foundation has committed more than $270 million to date for children’s issues in the United States and globally. Because of the proven social impact of microfinance, the Foundation is keenly engaged in bolstering growth-oriented microfinance institutions that have the potential of reaching millions of un-served poor. The centerpiece of MSDF’s initial efforts in microfinance is to catalyze the development of the urban microfinance market in India by providing risk capital to start-up microfinance organizations.
EDITOR’S NOTE: The Michael & Susan Dell Foundation is separate and distinct from the Dell Foundation. In any first reference, please use the ‘Michael & Susan Dell Foundation.' For second references, 'the Dell family foundation' or 'MSDF' may be used in lieu of the full Foundation name.
The Bellwether Microfinance Fund
The Bellwether Microfinance Fund was conceived by a small group of experienced Indian microfinance professionals and foreign investors as an Equity-Debt Fund, independently managed and run by professional fund managers. A US $10 million fund, Bellwether is the first fund in India dedicated to investing in the equity and debt of microfinance institutions across the country that are in line with the Fund’s mission and investment philosophy. For more information, please visit http://www.bellwetherfund.com.
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