Coming full 'cycle': Proving the impact investment model

Coming full 'cycle': Proving the impact investment model

Omidyar Network India (ONI) invests with the conviction that entrepreneurship, which also combines the broader interests of people and society, is essential to solve India’s hardest problems. In 2019, the firm’s exits from Aspiring Minds, Nowfloats and U2opia Mobile as well as a partial sale of its stake in Dailyhunt help validate this conviction. They also represent a step forward in the firm’s journey to establish itself as a “full cycle investor”.  

For the impact investing industry, these exits serve as examples of how tech-led investments can create a compelling combination of direct impact on customers lives, sector-level impact and financial returns. They can help the impact investing industry build on the success stories of the microfinance era.

In all these exits, Omidyar Network India worked in close collaboration with the entrepreneurs to create a “win-win” situation for all stakeholders. In addition to providing liquidity for ONI as an early stage investor, the exits enabled the founders to take their companies to the next level, either by merging with a larger entity or by creating space for new growth-stage investors who can support the company with larger cheques.

Aspiring Minds is an employability skills assessment company founded by Himanshu and Varun Aggarwal. ONI invested in the company in 2011. The organization strengthens the jobs ecosystem through technology that supports employers and job seekers alike. It has helped hundreds of companies, including many Fortune 500 companies, hire better. Its flagship product, AMCAT, an innovative science-based test is the world’s most widely taken employability test, helping over two million candidates find the ‘right’ jobs every year. The company’s unique vocational skills testing product also helped the Indian government’s skilling programmes. Over the years, Aspiring Minds has grown beyond its core IT/ITES focus into BFSI, automotive, manufacturing and retail sectors. It expanded to the Middle East, South-East Asia, China and the US.

Aspiring Minds is a great example of a truly innovative tech-led solution that can scale to reach millions of users in a profitable manner, go global, create significant financial returns and sector-level impact.

The company has been fully acquired by SHL, one of the world’s largest assessments companies.

NowFloats, founded by Jasminder Gulati, Nitin Jain, Ronak Samantray and Neeraj Sabharwal, enables businesses to set up an all-round digital commerce presence with websites optimised for SEO as well as manage their social channels like Facebook and Twitter seamlessly. ONI invested in the company in 2014. NowFloats has a customer base of over 200,000 small business owners and has demonstrated small businesses are indeed willing to pay for value-creating offerings. The company has now been fully acquired by Reliance Strategic Business Ventures Limited.

U2opia Mobile, founded by Sumesh Menon, made it possible for non-data based mobile phone users to access the Internet through USSD technology. The company partnered with the likes of Facebook and Twitter to serve relevant content to millions of subscribers in India, Africa and Latin America. With U2opia having achieved its intended impact since its 2014 investment, ONI exited in a majority sale to Comcraft Global to allow the company to explore newer avenues.

ONI made its first investment in Dailyhunt in 2011. Founded by Virendra Gupta, Dailyhunt is India’s largest news and local language content application providing news in 14 languages to over 200 million monthly active users. It pioneered the local language content model, a major step in empowering India’s “Next Half Billion”. ONI’s partial exit created space for later stage investors like Goldman Sachs and Sofina Investments. ONI remains invested in Dailyhunt and is excited about the company’s further growth and monetization potential.

Each of these companies has created unique impact – be it reaching millions of people or pioneering innovative business models – opening up opportunities for previously underserved people to realize their potential and create meaningful lives.