London-based nonprofit Global Innovation Fund launched its GIF Growth fund in Washington DC to much fanfare in November 2024. Then, the evergreen blended debt fund lost its $10 million commitment from the US International Development Finance Corp. after the election of President Donald Trump.
Nearly two years later, the fund, which aims to mobilize $130 million for high-impact enterprises in emerging markets, has announced a first close of $50 million. The remaining anchor investors, UK’s Foreign, Commonwealth and Development Office and the Korea International Cooperation Agency, were joined by the Swedish International Development Cooperation Agency, which provided a portfolio guarantee, and Global Affairs Canada, which added a layer of patient debt. UK-based foundation This Day, and Banca Etica, a cooperative bank focused on sustainable finance, also participated. The fund hopes to crowd in at least $400 million over a decade.
Impact debt
The fund will leverage the pools of capital, as well as grants, to provide $1 million to $10 million in debt financing to nearly 90 enterprises over a decade. The smaller ticket sizes are meant to fill a gap for growth financing and build a pipeline for DFIs and private investors able to write bigger checks.
“Impact debt functions as a loan that provides support similar to a grant but maintains commercial discipline,” GIF Growth’s Avinash Mishra told ImpactAlpha.
Its patient nature, he said, “allows enterprises to absorb business model risks and focus on long-term operational viability, without the immediate repayment pressures of conventional loans.” GIF says growth-stage companies are promising since they’ve already done the early de-risking work. It has so far backed SwipeRx, a network of mostly women pharmacy professionals in Southeast Asia, and Nairobi-based microlender 4G Capital, and expects to back two more enterprises this month.
