ADB unveils venture platform to invest in impact technology startups
Anchor trust fund has a target size of US$50 million and will focus on companies with solutions dealing with climate change and women
The Asian Development Bank (ADB) has approved the establishment of ADB Ventures, a venture platform that will support and invest in startups offering impact technology solutions that contribute to the achievement of the Sustainable Development Goals (SDGs) in the Asia-Pacific region.
“This region is brimming with technology solutions to conserve energy, reduce waste, fight climate change, and deliver public services effectively,” says ADB director general for Private Sector Operations Mike Barrow. “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.”
ADB Ventures Investment Fund 1, the facility’s anchor trust fund, has a target size of US$50 million and is accepting contributions from multiple funding sources including bilateral and multilateral development partners. It will mainly invest in early-stage startups and focus on companies with solutions that can address climate change and empower women. The fund has a 17-year fund life, allowing ADB to invest patient capital into cleantech, fintech, agricultural technology, and health technology solutions.
The Nordic Development Fund, Climate Investment Funds, and the Government of Australia funded project preparation for the ADB Ventures facility. ADB Ventures Investment Fund 1 is expected to begin operations in the second quarter of 2020. One of its main aims will be to mobilize private capital through co-investing with private sector investors.
“Our vision is for ADB Ventures to become the region’s largest impact technology platform, crowding in more than US$1 billion of risk capital to achieve the SDGs by 2030,” says Barrow.
Unlike traditional venture capital funds, ADB Ventures Investment Fund 1 is augmented by a three-year US$12 million technical assistance program that will support impact technology startups through two main activities. ADB Ventures SEED is a grant program to validate and de-risk technology pilots and promote expansion into emerging markets that startup companies might otherwise not prioritize.
ADB Venture Lab is a suite of corporate innovation programs implemented in partnership with industry and accelerators for startups. ADB Ventures will leverage ADB’s operational networks and industry expertise to generate technology pilot opportunities and support ADB Ventures Investment Fund 1 portfolio companies.
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