Impact investor firm Omidyar Network India will be pulling out of the India market. The group will no longer make new investments and plans to phase out from the market by the end of the next year.
“After several months of deliberation, it has been decided that Omidyar Network India will stop making new investments and will completely transition out of the market by the end of 2024. Over the next two months, the board and leadership team will assess how best to manage the organization’s portfolio while recognizing the long and trusted partnerships that the Omidyar Network India team has built,” said Omidyar group in a blog post.
The impact investor firm has had a presence in India since 2010 and has made investments of over $500 million, of which nearly $150 million was directed to non-profit investments. Nearly 70 per cent of the capital was directed at for-profit investments.
Omidyar Network India was hived off from the parent entity in 2019 as an autonomous investment advisory firm, focused on India-specific investment thesis and separate investment team.
The firm is an investor in the likes of two-wheeler mobility company Bounce, SME financing company Indifi, online pharmacy company 1MG, which was acquired by Tata Digital, and others. The investor is in the process of letting its portfolio companies know of its decision.
The blog further added, “This decision was heavily informed by the significant change in context and the growth in the economic landscape that the India-based team has experienced since first making investments there in 2010. Today, there is more Indian-led philanthropic and venture capital than ever before, the country has a vibrant start-up sector, and several funds now have a middle and lower-middle income focus as part of their investment strategy.”
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Backed by eBay founder Pierre Omidyar, it has made investments in several other startups like Centa, CloudSek, DealShare, Kiwi, Otipy, Doubtnut, and others. It recently led the $6-million round in Digivriddhi Technologies, a fintech start-up serving the dairy industry.
“Omidyar may have found that the going is tough for continuing investments given that they are a proprietary fund. Also, it looks like their investments have not given the desired returns,” said Shriram Subramanian, Founder of InGovern, a corporate governance advisory firm.
One of the firm’s portfolio company Doubtnut was acquired by Allen Career Institute for $10 million in what’s widely believed as a stress deal. Doubtnut had raised $50 million in different rounds of fundings.
Recently, several start-ups are taking drastic measures to survive – job layoffs, controlled expenses, and more. Firms like ZestMoney have also shut down amid the funding winter.
Omidyar group has come under scanner of the Union government over alleged unauthorised foreign funding.