Coalition of private and public institutions hope the platform will help close the financing gap for the SDGs
A new investment platform launched today in Davos is set to invest $500m in businesses working to achieve the global Sustainable Development Goals (SDGs).
The SDG500, backed by a coalition of public and private organisations, NGOs and a private equity firm, is billed as a "first-of-its-kind" platform dedicated to the SDGs.
The platform's funds will be used to make debt and equity investments in early stage businesses in "emerging and frontier" markets, to spur innovation and growth in regions where firms often lack access to follow-on financing.
The platform will focus on supporting firms in agriculture, finance, energy, education and healthcare across Africa, Asia, Latin America, the Caribbean and Pacific regions. It includes provisions to protect certain portions of investors' capital, sponsored by 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 launch of SDG500 is a unique milestone for the impact investing industry," said Jean-Philippe de Schrevel, founder and managing partner at Bamboo Capital Partners, which will manage the six funds on the platform. "We have never seen a coalition from the private and public sector come together to achieve the SDGs on this scale before."
A report from the UN in October warned a vast shortfall in financing is threatening progress against the SDGs, with UN executives calling for private finance to help bridge the $2.5tr a year financing gap. In particular, there is not enough cash to support early and mid-stage companies working on sustainable technology to scale in developing markets.
That's what the SDG500 platform wants to address, said Schrevel. "The missing middle financing gap is real, and it is suffocating early stage enterprises which have the potential to transform some of the world's poorest and most underdeveloped regions," he said. "We believe that by working together to finance and scale these businesses, we can achieve the SDGs and take another step closer to a better, more sustainable future for all."
Alongside Bamboo Capital Partners, coalition members include the United Nations Capital Development Fund, International Trade Centre, International Fund for Agricultural Development, CARE, Smart Africa, and Stop TB Partnership. The IDB Lab of the Inter-American Development Bank is an interested party.