Aavishkaar Frontier Fund: A fund for inclusive businesses and geared towards the low-income bracket

The Aavishkaar Frontier Fund (AFF) is a seed capital and venture capital fund which aims to invest in small local entrepreneurs in rural and semi-urban areas in Asia and Southeast Asia. It is the 5th fund launched by the management company Aavishkaar, which manages four other investment vehicles for impact investing in India. It was set up in 2001 by Vineet Rai and with over USD 150m under management today, Aavishkaar has played a key role in structuring the impact investing segment in India.

The Aavishkaar Frontier Fund (AFF) will target projects in the fields of agro-industry, renewable energies, education, health, water and sanitation, and, to a lesser extent, in the field of technologies. The companies eligible for financing will need to demonstrate that they have an inclusive economic model which generates significant positive impacts for low-income populations. AFF is Aavishkaar’s first regional initiative and includes four countries in its investment strategy: Bangladesh, Pakistan, Sri Lanka and Indonesia.

This operation will have a major impact on employment (1,100 jobs are expected to be created over the next 5 years) and significant social effects due to a strategy that targets entrepreneurial initiatives in rural areas whose beneficiaries are disadvantaged. It will also contribute to the development of the local economic base by supporting first-time entrepreneurs during the “upstream” phases of start-ups.