The venture investment arm of the nonprofit Accion invested in financial tech companies before “fintech” was a thing.
“When we started a decade ago, it wasn’t even a word,” recalls Amee Parbhoo, part of the VC group’s founding team.
After more than 75 investments and 13 exits, Accion Ventures has dropped “Lab” from its name. It has also closed its second fund, securing $61 million to find and seed promising startups driving access to financial services in emerging markets.
“We are sticking to our core mission. We’re still early-stage, still the first seed check,” said Parbhoo. But: “It doesn’t feel like we’re a lab anymore.”
Next-level fintech
When Accion started investing in fintech in 2015, many solutions were focused on credit or savings. Fintech has expanded access to mobile money, online banks, payment systems and digital banking. The percentage of adults worldwide that have secured access to formal financial services has increased from 52% to 75% in the past decade, and two in three adults use some form of digital payments, said Parbhoo.
Accion is now focusing on driving inclusion through “contextualized” financial products: “how people are using financial products to better their lives, to become more resilient, to grow their businesses,” Parbhoo said. “We haven’t made as much progress on that.”
Among the portfolio companies in Accion Ventures’ second fund is PaidHR in Nigeria, which provides payroll and HR services to small businesses and startups. Foyer in the US is helping first-time homebuyers save for a down payment with a high-yield savings product. FinFra in Indonesia provides embedded finance to help small businesses secure access to credit.
Accion Ventures’ most recent investment is in TransBnk, a banking and payments infrastructure company in India.
Repeat investors
Accion Ventures’ second fund was anchored by Dutch development bank FMO and Accion. Proparco, Ford Foundation, MetLife Asset Management, ImpactAssets and Mastercard also participated.
“Most of our existing investors from fund one reupped and put in more for this fund,” said Parbhoo. “That kind of support and commitment when it’s a very difficult fundraising environment is huge, and was very helpful for us in the fundraising process.”
