Wednesday, November 09, 2005

Dalit Capital

Request for expression of interest in investing funds in venture capital company focused on the needs of 250 million dalits in India

I am a interested in launching a venture capital company which will invest in ventures of interest to the dalits in India. Dalits are currently on or ouside the fringes of mainstream Indian markets. They represent a large potential market, an opportunity for trustworthy commercially viable intemediaries which can enable them to integrate into the mainstream Indian markets. I am looking for funds from sources sensitive to such possibilities related to 250 million dalits accross India.

The main focus of the fund will be on developing a value chain of ventures which process dalit human capital and deploy it in the Call-centre, IT, ITO and BPO job market. The value chain will select candidates from among graduate dalits, provide them appropriate intensive vocational training and enable them to find jobs in the Call-centre, IT, ITO, BPO industry. The present value chains are discriminating at the input stage (since many dalits are not able to finance their chains processing cost) and at the output stage (since most dalits do not have social networks which can help them in finding gainful employment, even if they are equal or better than their peers). So the main focus will be on financing placement agencies, training and related finance companies and enabling them to work in tandem.

Some of the other types of ventures that will be financed will be as follows

A. Trusted intermediaries can improve the access of dalit entrepreneurs to financial services, including venture capital, project finance and working capital finance to launch viable projects. Individual dalits are also potential customers for educational finance, consumer finance including car, equipment, home loans and credit cards, etc. Non-dalit intermediaries are poor at measuring and managing the project and credit risk of proposals from dalit communities, since they do not adequately understand the drivers of the project and credit risk, which are different from mainstream. Due to this there is a discrimination risk premium available to those intermediaries who are better equipped at measuring and managing the credit risk of these communities.

B. Similarly dealerships and franchises of products and services which are or relevance to dalits due to their locations or socio-economic needs are currently owned mostly by non-dalits. Enabling dalits to manage the last mile in distribution and sourcing chains can create differential competitive advantage with respect to selling products and services to dalit individuals and communities accross India. This kind of trusted intermediaries will be able to provide better customer service, better credit-risk-measurement-and-management and increased brand loyalty.

C. Intermediaries providing investment/tax advisory and execution services to dalits need to have trusted relationships with dalits. Many dalits cannot buy the costly seat in the marketplace needed to provide this kind of services and hence have to depend on non-dalit providers of these services. The non-dalits providers are rarely aware of the unique treatments available to dalit individuals and firms under Indian law and hence are not able to provide good service to dalits. We aim to fund intermediaries, which can fill this gap in the market.

I have the relevant knowledge, experience and contacts in all the relevant entities to successfully create and manage the aforementioned venture capital company. I am primarily looking for funds at this point of time. So if you can provide funds and/or have suggestions/comments related to how I can find funds, I would like to hear from you at
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