Lok Capital exits India BPO firm

The identity of the buyer has not been revealed.

Lok first invested an undisclosed amount in RuralShores - which claims to be India's first rural BPO company - in 2009 via its $22 million maiden fund.

A follow-on investment of $3 million from Lok Capital Fund II - a $65 million fund - came in 2011. The firm has only exited its Fund I stake and continues to be an investor via Fund II.

RuralShores was set up by Marali Vullaganti in 2008 to help bring jobs to villages and mitigate the migration of rural youth to the cities. It runs 18 centers across a number of Indian states and employs 2,500 people, nearly half of whom are women.

The business began as a provider of remote processing for non-critical business transactions but has since evolved into a high-end BPO service, offering customer care and payroll management.

It currently has around 24 clients including telecom and IT companies and the government. The company reported revenues of INR315 million ($5.2 million) for the 2013 financial year and expects to reach INR1.5 billion by 2017.

"RuralShores brought the right elements to become the anchor investment for Lok's portfolio outside of microfinance," said Venky Natarajan, managing partner of Lok Capital, in a statement. "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."

Lok Capital Fund I primarily focused on microfinance enterprises. Ten investments were made, of which six have been exited. Notable exits include Satin Creditcare Network, Janalakshmi Financial Services and Spandana Sphoorty Financial.

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• Topics
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• professional services
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