Impact Investing at the Base of the Pyramid: Unitus Seed Fund

Abstract

The Unitus Seed Fund is an early-stage venture fund focused on investing in companies with innovative, scalable business plans to serve the population at the base of the economic pyramid (BOP). Operating out of Seattle in the USA, and Bangalore in India, the Unitus Fund partners and Fund investors believe that local entrepreneurial activity will provide a strong and sustainable foundation for economic development and improved quality of life at the base of the pyramid in India and other countries. This chapter describes the Unitus Seed Fund investment strategy, profiles the social mission and impact of some of the Fund’s portfolio companies in India, and analyzes the challenges of achieving the Fund’s dual goals of providing venture investors with superior, long-term capital appreciation by investing in companies that will provide critical services and economic opportunities to millions of BOP individuals in India. In spring 2016, Unitus Seed Fund launched a second, even larger BOP investment fund that will total $50 million in capital to be used as seed funding for about 30 new social enterprise startups, plus follow on investment in the original portfolio companies. The new fund is raising its capital from many of the original US investors such as Bill Gates and the Dell Foundation, along with more investors from India. As the Unitus Seed Fund looks toward its next 5 years of impact investing in India, the managing partners will apply the lessons and insights gleaned from the current portfolio companies to their future investments.