The Overseas Private Investment Corporation, a federal agency that helps American businesses invest in emerging markets, has launched a venture capital program that will invest in later-stage venture funds supporting developing economies. So far, the initiative has made an undisclosed investment in Iron Pillar, which provides growth capital to technology businesses in India.
MUMBAI – The Overseas Private Investment Corporation (OPIC) on Friday announced the launch of a venture capital initiative designed to build on the agency’s existing financial tools by supporting venture capital funds investing in proven and emerging technologies that address critical challenges facing the developing world.
Iron Pillar, a venture growth investor specializing in technology businesses in India, is the first fund commitment under this new initiative. Iron Pillar provides growth capital to proven businesses in the enterprise and consumer technology sectors. The fund has begun developing a portfolio of investments in technology businesses that demonstrate a potential for making a positive impact on the Indian economy.
The launch of this venture capital program advances OPIC’s ongoing efforts to help entrepreneurs and early-stage companies achieve scale and attract institutional capital to grow their business.
OPIC will typically commit between $5 million and $25 million, or up to 25 percent of a fund’s total capitalization. Funds applying for OPIC support will be selected on a quarterly basis through an open and competitive process and eligible funds must comply with OPIC’s standards on human rights, labor rights and U.S. effects.
“Venture capital is an effective tool for identifying entrepreneurs that show promise for impact and growth,” said David Bohigian, OPIC Executive Vice President. “OPIC has seen many small businesses have a big impact in emerging markets and by supporting venture capital funds focused on these markets, we’ll be able to reach more of these promising young businesses.”
“We are delighted to be the first fund selected for OPIC’s new global venture capital program,” said Sameer Nath, Managing Partner of Iron Pillar. “We are excited about the venture growth investment opportunity in the Indian market and look forward to partnering with an experienced and long-term investor like OPIC on this important journey.”
The launch of the venture capital program comes at a time when venture capital investment in emerging markets is growing. According to Preqin, venture capital investment in emerging markets has risen from $800 million invested across 127 deals in 2009, to $13 billion invested across 1,168 deals in 2017.
The Overseas Private Investment Corporation (OPIC) is a self-sustaining U.S. Government agency that helps American businesses invest in emerging markets. Established in 1971, OPIC provides businesses with the tools to manage the risks associated with a foreign direct investment, fosters economic development in emerging market countries, and advances U.S. foreign policy and national security priorities. OPIC helps American businesses gain footholds in new markets, catalyzes new revenues and contributes to jobs and growth opportunities both at home and abroad. OPIC fulfills its mission by providing businesses with financing, political risk insurance, advocacy and by partnering with private equity fund managers.
OPIC services are available to new and expanding businesses planning to invest in more than 160 countries worldwide. Because OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers. All OPIC projects must adhere to best international practices and cannot cause job loss in the United States.