Lok Capital, the Rockefeller Foundation-backed impact investment firm, is announcing a partial exit from BPO company RuralShores. The financial details of the exit have not been disclosed. However, the firm said that it has earned a 6X multiple on its initial investment, made from the Lok Capital Fund I. The investment was made in 2009.
While Lok Capital Fund I has completely exited RuralShores, the firm’s second fund, Lok Capital Fund II, remains invested in the BPO company. This investment was made in 2011.
“RuralShores brought the right elements to become the anchor investment for Lok’s portfolio outside of microfinance. Right from the beginning, we were convinced about the business model’s effectiveness in generating rural employment. This investment proves that livelihood generation is a sustainable way to create inclusion among the low income group. The model is replicable in various sectors and has the potential to open up endless opportunities to create impact,” Lok Capital managing partner Venky Natarajan said in a statement.
Founded by Murali Vullaganti in May 2008, RuralShores was created to bring jobs to villages rather than move rural citizens to cities. It works with rural citizens in improving their skill sets, provides local employment and curbs migration. Currently, it run 18 BPO delivery centres across several Indian states and employs over 2500 rural youth. The company reported revenues of Rs 31.5 crore (over $5 million) in FY2013. Women constitute 45 per cent of the company’s workforce. The company now serves over two dozen clients including leading telecom and information technology companies, as well as government agencies.
Lok’s team has been instrumental in helping us build a strong team, scale significantly and identify new business opportunities,” Vullaganti said.
Apart from RuralShores, some of the other exits from Lok Capital Fund I include Satin CreditCare, Janalakshmi Financial Services, Spandana Sphoorty Financial and Arohan Financial Services — read more on the fund’s exit run despite the 2010 microfinance crisis.
Apart from Lok Capital, HDFC is also an early investor in RuralShores.