Dataquest is a leading Indian animation services company providing outsourced 2D/3D animation and multimedia production services to North American and European production houses. Dataquest specializes in 2D cell animation production and post-production for TV and feature films. It was founded in 1987 by Mr. Tapaas Chakravarti to undertake international business consulting. During 2000/2001, earlier operations were discontinued and the company focused on setting up the infrastructure needed to establish its animation business. Project Overview The proposed investment will build up the company’s execution process and boost co-production contracts from leading European and North American animation firms. By 2004, Dataquest plans to have - doubled its staff - increased its investment in 2D infrastructure - developed 3D infrastructure, and - created intellectual property rights (IPR). Development Impact The project will have strong developmental impact in the following areas: Employment creation. India’s domestic animation market is nascent because of lack of highly skilled animation professionals and intellectual property rights. Dataquest plans to expand its staff from 300 today to over 750 by year-end 2004. Training. The company has established its own school that trains staff in state-of-the-art animation production. Demonstration effect. A successful investment in Dataquest will help to attract more foreign capital to the information technology (IT) sector in India. The current conditions in the equity markets are difficult, and IFC’s investment will likely lead to further financing opportunities for Dataquest itself, as well as help generate interest in other Indian IT ventures. IFC Role An IFC investment at this time will be beneficial to the company in several ways: The downturn in the global technology sector and the subsequent slowing of technology-related investments by equity finds has made it difficult for companies such as Dataquest to raise capital. IFC’s investment will help close the financing gap. IFC’s presence would lend additional credibility to the company, and help it attract other investors in future rounds of financing. Due to the global nature of the animation business, IFC’s international experience and perspective would be valuable to the company going forward.