(Alt Assets) Mexican social enterprise-focused venture capital firm IGNIA has completed a $90m first close of its second fund.
The capital has been raised especially for investments in high-growth companies in Mexico.
Among the LPs backing the vehicle are Mexican pension funds which commit for the first time to a venture capital fund. IGNIA says this shows that institutional investors have confidence in its track record.
Alvaro Rodriguez Arregui, co-founder and managing partner of IGNIA, said, “We are very grateful for the confidence that Mexican pension funds have placed in IGNIA Fund II and for the opportunity to continue investing in the tremendous opportunity that exists in the base of the pyramid market, which to date has been hugely unattended.
“We have identified companies in our pipeline that have an enormous potential. With IGNIA Fund II we will take advantage of the growing ecosystem of entrepreneurs in Mexico and the opportunities that we are finding.”
Apart from the Mexico-focused vehicle IGNIA’s Fund II also includes an international vehicle, a Canadian limited partnership fund, which is currently fundraising from international and local investors. The international fund is expecting to hold a final close within the next six months.
The Mexico vehicle was raised through the publicly traded certificates known as Development Capital Certificates (CKDs). These trust securities certificates were launched in 2009 and are designed primarily for the financing of long-term infrastructure projects in Mexico and the development of mid-size Mexican companies.
Michael Chu, o-founder and managing director of IGNIA, commented, “When we founded IGNIA eight years ago we had the objective of connecting the capital markets with the base of the socioeconomic pyramid.
“The issuance of the CKDs in the public capital markets is a testament that this is possible.”
With Fund II, IGNIA plans to continue its strategy of investing in businesses at the bottom of the socio-economic pyramid in Mexico. This is why companies from sectors such as healthcare, housing, education, financial, water, energy and communications are on the firm’s radar.
The firm closed its debut fund on $102m in June 2010. IGNIA Fund I reached the close after seven rounds of fundraising, breaking initial targets of $50m to $75m, with the final round led by JP Morgan and a Corporacion Mexicana de Inversiones de Capitol fund of funds.