Impact Investment Profile

Investor

Accion Frontier Investments Group

Investee

Vindhya e-Infomedia Private Limited

A Vindyha employee provides back office support to a microfinance institution

Accion Frontier Investments Group is a double bottom line venture equity fund focused on financial inclusion at the base of the pyramid. Vindhya e-Infomedia Private Limited is an India-based business process outsourcing firm that provides data processing and entry services to local and global companies. Accion Frontier Investment Group’s early stage equity investment will provide growth capital to build the firm’s infrastructure, recruit new talent, and acquire customers.

Investor Targeted Impact

Generate efficiency in microfinance services provision to reduce costs and benefit clients

Investor

Name Accion Frontier Investments Group
Investor description Accion Frontier Investments Group (Frontier) is a double bottom line venture equity fund focused on expanding financial inclusion at the base of the economic pyramid. Its mandate is to go beyond the current boundaries of the microfinance industry and invest in disruptive business models--technologies, products, and services that will enhance the efficiency, reach, and scope of products and services for the unbanked.Frontier aims to generate balanced financial returns and high impact social gains by leveraging the experience of its parent organization, Accion International. Accion International has five decades of investing experience in emerging markets, including on-the-ground specialized domain expertise and institutional relationships in four continents.

Investee

Name Vindhya e-Infomedia Private Limited
Sector ICT
Geography South Asia - India
Investee business model Vindhya e-Infomedia Private Limited (Vindhya) is a business process outsourcing (BPO) firm based in India that provides data processing and entry services to local and global companies. Its specialized BPO services improve the efficiency of high cost service delivery processes, including the provision of microfinance services. Microfinance institutions (MFIs) outsource their back office functions to Vindhya, which increases their clients' operational efficiency by using industry best practices for back office functions. Vindhya has expanded its BPO service offerings globally in order to increase its impact both in the microfinance sector and in other industries. Vindhya mainly employs differently‐abled individuals, providing positive employment to a population with limited opportunities to apply their talents, and specifically creates operational systems to accommodate their abilities.
Motivations for investment Vindhya was an attractive equity investment to Frontier for two reasons. First, it meets Frontier's goal of driving greater efficiency in the microfinance sector because it creates cost savings for the MFIs that use its BPO services. Vindhya has expertise providing outsourcing services to the microfinance sector, serving clients such as Ujjivan, Janalakshmi, and Swadhaar. Second, Vindhya has a competitive advantage in a growing market, promising growth prospects, and has already developed large corporate clients such as Yahoo! and Wipro.Vindhya's competitive advantage lies in attracting and retaining talented employees at a reasonable cost. Vindhya's employees' abilities are often masked by a physical handicap, but Vindhya's uniquely-designed operational processes support their performance. Compared to competing BPO firms, Vindhya maintains a low employee attrition rate of 3‐4 percent compared to 40 percent for most BPO service providers, which drives down its operations and training costs. Vindhya's business model meets growing demand from large companies that, through their corporate social responsibility strategies, seek to diversify their workforce.

Investment

Instrument Equity
Investment size USD 600,000
Source of deal This deal was brought to Frontier by a financial intermediary.
Stage of company at time of investment Early Growth
Purpose of investment The growth capital provided by this financing round will be used to build infrastructure, recruit new talent, and expand Vindhya's customer base.
Investment impact objectives Frontier seeks to increase the efficiency of MFIs' delivery of financial services through its investment in Vindhya. Because Vindhya streamlines MFIs' back office functions, it creates efficiencies that help its clients channel resources toward service delivery and thus positively impact their target populations.
Social and environmental metrics tracked on investment Frontier tracks the following metrics to monitor the social performance of its investment. Roughly half of the metrics align with IRIS (IRIS alignment noted in parentheses).Operational Model (IRIS aligned - OD6306)Customer Model (IRIS aligned - OD8350)Earned Revenue (IRIS aligned - FP5958)Cost of Goods Sold (IRIS aligned - FP9049)Gross Margin (IRIS aligned - FP4373)Personnel Expense (IRIS aligned - FP4831)Selling, General, and Administrative Expense (IRIS aligned - FP9649)Operating Expense (IRIS aligned - FP1001)Net Income (IRIS aligned - FP1301)New Investment Capital (IRIS aligned - FP8293)Clients (IRIS aligned - PI7094)Full Time Employees (IRIS aligned - OI3160)Cost of Services Rendered per Full Time EmployeeBillable Full Time Employee ExpenseOperational Expense per Full Time EmployeeRevenue per Billable Full time EmployeeAttrition RateUtilizationPercent of Workforce Comprised by Differently-abled EmployeesPermanent Employees: Disabled (IRIS aligned - OI4083)Permanent Employees (IRIS aligned - OI8869)

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