New Delhi/Mumbai: Education sector-focused private equity (PE) firm Kaizen Management Advisors Pvt. Ltd said it has marked the first close of its second fund—Kaizen Private Equity II—at Rs285 core (about $42 million) with five investors that included institutions and strategic education companies.
The PE firm aims to raise $125 million for this fund. Its previous fund raised around $70 million.
Kaizen has also made first investment from its second fund in Hyderabad-based INSOFE (International School of Engineering), a professional skills training firm with a specialization in data sciences/big data analytics. The firm did not disclose the deal value and stake size.
“This synergy adds immense value and brings in the needed direction and capital for global expansion. The expansion plans involve setting up a research environment on par with global leaders, on-boarding world-class faculty to join INSOFE team and also ensuring excellence in applied engineering education for our students with world-class standards. We are also launching a full-time programme soon and the expansion plans include cities both in India and abroad," INSOFE founder Dakshinamurthy V. Kolluru said.
“Our locally situated team members have a combination of operations and investment experience and are geared to work closely with local institutions to help them solidify their market leadership positions," said Sandeep Aneja, managing partner at Kaizen.
The ticket size for the second fund is expected to be in the range of $8-15 million, and the fund is expecting to invest in some 15 firms. The final close of the fund is expected in the end of this year.
It has already made 10 investments from its first fund.
Founded in 2009 as an education-focused private equity fund manager, Kaizen invests in education in emerging Asia with a focus on the Indian subcontinent and select Asean countries.
Kaizen initially focused on India. The first fund—Kaizen I—was launched in 2010, and it raised capital for equity investment from International Finance Corporation, Swiss Investment Fund for Emerging Markets, HDFC India, UBS Fund of Funds and Bertelsmann.
Some of Kaizen’s portfolio companies include Neev Knowledge Management Pvt. Ltd, which offers online and classroom-based certification courses under the brand EduPristine, a video-based educational services start-up Impartus Innovations, K-12 Techno Services, Varthana, Ace Creating Learning and WizIQ, among others.
The company’s portfolio revenue has grown on an average of 40% annually post investment and continues to have an upward trend.