Unitus Seed Fund is excited to announce that we’ve made a seed investment in iSTAR, based in Bangalore.
iSTAR is a vocational skills training company that provides unemployed graduates with additional skills training to make them readily employable in the BFSI and ITeS sectors. iStar employs carefully-selected faculty and a unique activity-based learning model to deliver their training which is designed to achieve high levels of student engagement and measurable learning outcomes.
iSTAR started its first iLAB program in Dec 2011 with 300 students and has grown continuously since, training 2,500 students across Bangalore. Highlighting the value of their program, iSTAR was able to successfully place all students who completed their training in jobs – far exceeding the dismal placement rate of other programs. This academic year, iSTAR plans to expand its training offering to a larger number of tier 1 and tier 2 cities across India.
Why we’re excited about what iSTAR is doing
Issues of employability remain prevalent in India, as formal qualifications are often not a sufficient indicator of skills. More than 75% of the country’s graduates are considered unfit for employment. The main issue of employability is that there is a mismatch between the skillsets developed by the students and the actual requirements of demanding job environments. We like iSTAR for its innovative business model that is targeted at reducing the gaps that so many educational institutions have failed to address.
Employability has become an issue for graduates of most tier 2 and tier 3 colleges, where the majority of students are from low income families. The children of these families would often be the first generation going for higher studies. Since tier 2 and tier 3 graduates are iSTAR’s main focus, their programs will directly impact many lakhs of low income families and help them move out of poverty.
The team at iSTAR is committed in building a skills development platform that address the issue of employability among the BoP – base of the economic pyramid – population. Its founders are from top ranking business schools and have a strong entrepreneurial background. They bring valuable insight from their previous experience with both startups and established companies. iSTAR is a leading example of a new generation of “BoP Startups” that are bringing improved opportunities to crores of families living at the BoP.
The funding is the first institutional capital raised by the Bangalore-based company. This announcement was also featured in The Economic Times on April 19th 2013.
iSTAR has been funded by and is an official partner of the National Skill Development Corporation, a public private partnership set up under the Ministry of Finance at the Central Government of India. Centre for Innovation, Incubation and Entrepreneurship (CIIE) set up by the Indian Institute of Management, Ahmedabad, is also an equity investor in iSTAR.
Unitus Capital was the financial advisor and Impact Law Ventures was the legal advisor on this transaction.