ADB raising $50m for SDG-focused debut venture fund
03 February 2020 | Mitigation
Manila-headquartered Asian Development Bank (ADB) is raising $50 million for its debut fund that will invest in startups offering impact technology solutions that contribute to the achievement of the Sustainable Development Goals (SDGs) in Asia and the Pacific.
ADB Ventures Investment Fund 1 is the anchor trust fund of ADB Ventures, the newly-established venture platform of the regional lender. The fund will mainly invest in early-stage startups and focus on companies with solutions that can address climate change and empower women.
ADB Ventures Investment Fund 1 will have a 17-year fund life, allowing the lender to invest patient capital into cleantech, finch, agricultural technology, and health technology solutions, according to a statement.
The launch of ADB Ventures and the debut fund confirms DealStreetAsia’s report in May that quoted an ADB executive.
ADB Director General for Private Sector Operations Mike Barrow said Asia is brimming with technology solutions to conserve energy, reduce waste, fight climate change, and deliver public services effectively.
“ADB Ventures will help bring these solutions to market by leveraging our extensive operational networks and filling the risk capital gap facing innovative early-stage companies in developing Asia and the Pacific, particularly smaller and frontier markets,” Barrow said.
The debut fund is expected to begin operations in the second quarter of this year, aiming, among others, to mobilize private capital through co-investing with private sector investors. It will be augmented by a three-year, $12-million technical assistance program that will support impact technology startups.
“Our vision is for ADB Ventures to become the region’s largest impact technology platform, crowding in more than $1 billion of risk capital to achieve the SDGs by 2030,” Barrow said.
The establishment of ADB Ventures comes less than a month after a coalition of private and public sector organisations, including United Nations entities and private equity firms, launched SDG500, a new investment platform that seeks to invest $500 million in businesses in Asia and other emerging markets.
The financing gap to achieve SDGs by 2030 in developing countries is estimated to be $2.5 trillion per year, according to a statement.