Prime Minster to announce new funding for development innovations.
Entrepreneurs, academics and NGOs will be among those able to access new funding for innovations that can help save lives in the world’s poorest countries, the Prime Minister will announce today.
Speaking ahead of the G8, the PM will announce the launch of Global Development Innovation Ventures, which will find innovative solutions to some of the world’s most pressing problems. It will test their successes and invest in the best performers.
The British government will invest £50 million over five years in the new investment platform, which is expected to unlock further investment capital from both the private sector and other countries. The US government and impact investor Omidyar Network will also be founding partners of the new platform.
The Prime Minister will say:
“More than any time in history our world is being shaped by innovation, new ideas, new technologies and new companies. This is the story of the global economy.
“Countries around the world have got to get this. Jobs and growth depend on it. We’ve all got to open up our economies to innovation, we’ve got to nurture new ideas, we’ve got to bend over backwards to attract the best and the brightest. A global race is underway and it is waiting for absolutely no one.”
International Development Secretary Justine Greening said:
“Britain has already supported groundbreaking technology around the world, from mobile banking in Kenya to GPS weather-warning systems in Bangladesh. We need a model that can build on these successes and make sure great ideas that can change the lives of the world’s poorest people get the investment they need.
“This new organisation means that the UK will play a key role in kickstarting a new era of innovative, cost-effective development which can help deliver a safer, more prosperous world.”
USAID Administrator Dr. Raj Shah said,
“We are proud to see that this model, born at USAID, has become a global tool for improving effectiveness in development. Our partnership with the UK and future investors will amplify our impact through the discovery of breakthrough technologies and approaches to help end extreme poverty.”
Managing Partner of the Omidyar Network Matt Bannick said:
“The challenges facing those from the poorest communities cannot be solved with conventional approaches to development aid alone.
“Global Development Innovation Ventures promises to replicate the most effective strategies we’ve deployed as a global impact investor: public and private organisations working together, leveraging technology and investing in both for-profit and non-profit organizations to spark innovation and scale successes.
“Omidyar Network is proud to be a founding partner alongside the UK and US government and to lend our perspectives and expertise to this important undertaking.”
Global Development Innovation Ventures will be open to promising innovations from around the world. The UK’s Department for International Development (DFID) will engage with innovators all over the world to encourage them to submit ideas, creating jobs both in the UK and across the developing world.
The initiative builds on the Development Innovation Ventures programme, run by the US Agency for International Development (USAID) since 2010. Examples of the investments this program has made include:
Unlocking private investment capital: Mera Gao Power (MGP) is reaching thousands of un-electrified homes in India with village-level solar micro grids for 25Rs (30p) per week. This price is half the cost of kerosene and less expensive than the subsidised national grid power. Development Innovation Ventures funding provided MGP with start-up capital when private sector support was hard to find. Since then MGP has attracted private financing for their next expansion.
Creating new markets: The start-up Sanergy, focussed on an issue facing 2.5 billion people across the world - access to basic sanitation. Investment in Sanergy piloted its network of pay-per-use latrines in the urban slums of Nairobi. The sanitation centres were franchised to local entrepreneurs, who earned income through usage fees, membership plans, and sales of complementary products. The company collected the waste daily to process as commercial-grade fertilizer and biogas that were sold for a profit. It is estimated that this intervention could create a $72 million annual market in the slums of Kenya alone.
Notes to editors
- DFID will contribute £50 million to Global Development Innovation Ventures over five years.
- USAID’s Development Innovation Ventures program currently provides up to $24 million per year in competitive innovation investments, and the FY2014 President’s Budget requests an expansion of this effort to over $28 million. For more information go to: http://www.usaid.gov/div/
- Global Development Innovation Ventures will be incorporated in the UK with offices in both the UK and the US.
- Global Development Innovation Ventures will:
- Find, develop and test innovations that have the potential to generate significant social impact and economic returns
- Develop a pipeline of investment-ready innovations, providing a focus for social investors and unlocking commercial capital
- Create a marketplace to broker co-investment and collaboration between investors and innovators alike;
- ‘Crowd-in’ a global network of partner governments, private investors, foundations and donors with resources to bring proven concepts to widespread adoption
- Omidyar Network is a pioneering impact investment firm dedicated to harnessing the power of markets to create opportunity for people to improve their lives. Established in 2004 by eBay founder Pierre Omidyar and his wife Pam, the organisation invests in and helps scale innovative organisations to catalyse economic and social change. To date, Omidyar Network has committed more than $611 million to for-profit companies and non-profit organisations that foster economic advancement and encourage individual participation across multiple global initiatives.