SDG500 is a ground breaking USD$500 million investment platform to accelerate progress towards the SDGs
SDG500 is a pioneering multimillion-dollar investment platform dedicated to helping achieve the SDGs.
- The investment platform will use debt and equity to bridge the financing gap between seed and growth stage for hundreds of businesses in emerging and frontier markets.
- The coalition partners include: United Nations Capital Development Fund, International Trade Centre, International Fund for Agricultural Development (IFAD), CARE, Smart Africa, Stop TB Partnership and Bamboo Capital Partners. The IDB Lab of the Inter-American Development Bank is an interested party.
Davos, 22 January 2020 – A coalition of private and public sector organisations, including United Nations entities, non-governmental organisations and a private equity firm today announces the launch of SDG500 – a new investment platform to help achieve the Sustainable Development Goals (SDGs).
This USD$500 million investment platform is the first-of-its-kind dedicated to helping achieve the SDGs. SDG500 will offer an exposure to six different underlying funds. Each of these funds is or will be managed by impact asset manager Bamboo Capital Partners.
The funds will use debt and equity to invest at Seed, Series A and Series B stages in hundreds of businesses in emerging and frontier markets. SDG500 aims to address the ‘missing middle’ financing gap that affects entrepreneurs in these markets, where growth is constrained by a lack of access to follow-on financing.
The funds will target businesses in the agriculture, finance, energy, education and healthcare sectors across Africa, Asia, Latin America, and the Caribbean and Pacific regions. There will also be a gender-lens focus and some of the funds will specifically invest in businesses that empower and provide jobs for women.
The funds composing the SDG500 platform each include a catalytic first loss layer designed to encourage and protect senior tranches of funding. Initial sponsors of the catalytic layers of the funds of SDG500 include the European Union, the African, Caribbean and Pacific Group of States, the Governments of Luxembourg, Togo and Tunisia, CARE and the Alliance for a Green Revolution in Africa.
The International Trade Centre has joined forces with CARE to establish the CARE-SheTrades Fund, one of the six Funds comprising the SDG500 Partnership, which will provide financing to businesses promoting gender equality through actions in the workplace, supply chain, women’s entrepreneurship and gender responsive products. With a target size of $75 million, a senior tranche of $60 million and $15 million as first loss, the CARE-SheTrades Fund will generate an expected rate of return of 7.5% to harness the power of the private sector in pursuit of SDG 5 on gender equality.
The underlying six funds are: the ABC Fund, an impact investment vehicle targeting smallholder farmers and small and medium agribusinesses in developing countries; BUILD, a fixed income fund aimed at early stage enterprises in the Least Developed Countries; the CARE SheTrades Fund, a gender lens fund which will use debt and equity to invest in businesses in Asia; BLOC SmartAfrica and BLOC Latin America, venture capital funds targeting technology enterprises in Africa, Latin America and the Caribbean respectively; and HEAL, a venture capital fund investing in healthtech businesses in emerging and frontier markets.
The financing gap to achieve the SDGs in developing countries is estimated to be US$2.5 trillion per year. To achieve the SDGs by 2030, more innovative and sustainable financing solutions are required. The launch of the initiative will be announced at the “SDG500 Roundtable” which takes place today in Davos, on the sidelines of the World Economic Forum Annual Meeting.
Dorothy Tembo, ITC’s acting Executive Director, said:’ The SDG500 platform will immediately target businesses in the agriculture, finance, energy, education, and healthcare sectors in Africa, Asia and Latin America – turbo boosting progress towards the SDGs. Importantly, the fund has a gender focus and will invest in businesses that empower and provide jobs for women – including through the participation of ITC’s innovative SheTrades initiative, which aims to connect three million women entrepreneurs to market by 2021. We welcome the launch of this groundbreaking endeavour.’