Soros Economic Development Fund, Omidyar Network and Google.org Launch Small to Medium Enterprise In
Wednesday, February 20, 2008
NEW YORK, (February 19, 2008) ? The Soros Economic Development Fund (SEDF), Omidyar Network, and Google.org announced today a new $17 million Small to Medium Enterprise Investment Company for India to create job opportunities and spur greater economic participation for a larger segment of the population. This joint Investment Company will provide capital to small and medium businesses in underserved markets.
Investment to Target ?Missing Middle? Between Microfinance and Commercial Capital Markets
NEW YORK, (February 19, 2008) ? The Soros Economic Development Fund (SEDF), Omidyar Network, and Google.org announced today a new $17 million Small to Medium Enterprise Investment Company for India to create job opportunities and spur greater economic participation for a larger segment of the population. This joint Investment Company will provide capital to small and medium businesses in underserved markets.
?With this investment, we will meet the huge demand to serve smaller businesses in India that have little access to finance,? said Neal DeLaurentis, Vice President of Soros Economic Development Fund. ?Long ignored by commercial capital markets, small and medium businesses are an attractive investment opportunity as well as an engine for economic growth for India.?
Many small to medium Indian businesses lack formal funding options because of a market gap between the microloans offered by microfinance institutions and the larger investments of commercial banks and private equity funders. Most of the existing Small to Medium Enterprise funds make investments in the $3-$5 million range, leaving out a significant portion of this market. The Investment Company will target this ?missing middle? with equity investments between $500,000 and $3.5 million.
?We have seen what microloans can do at the individual level and are excited about bringing that same opportunity to small and medium businesses,? said Jim Bunch, Director of Investments at Omidyar Network. ?A new generation of entrepreneurs and their families will benefit economically and socially, and as their enterprises grow, these benefits can be shared with employees and their families, as well as the community at large.?
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