Accion, a U.S.-based nonprofit that works to improve financial inclusivity globally, has announced that Accion Venture Lab, a seed-stage investment initiative, has secured $33 million in capital in support of fintech startups working to improve the reach, quality, and affordability of financial services for underserved communities.
The new capital is from the launch of a $23 million fund seeded by investments from third-party impact and commercial investors, as well as an additional $10 million from Accion itself. Launched in 2012 with $10 million in capital, the initiative provides fintech startups with both capital and strategic and operational support across a broad range of functional areas. For every dollar the initiative has invested at the seed stage, its portfolio companies have raised an additional $13 in equity capital from later-stage investors.
Investors in the initiative currently include the Ford, Heifer, MetLife, Open Society, and Pace Able foundations; the ImpactAssets Giving Fund of the Blue Haven Initiative; FMO, the Dutch entrepreneurial development bank; Proparco, the French Development Agency's private-sector financing arm; Prudential Financial; the Stichting Hivos-Triodos Fund; and Visa Inc. In 2017, the initiative also launched the Accion Venture Lab Company Builder program, which recruits entrepreneurs to create inclusive fintech startups in which the initiative can invest.
"Despite progress, three billion people still have no safe or simple way to save money, get a loan to build a business, pay a bill, or protect their health and property with insurance," said Accion president and CEO Michael Schlein. "Fintech startups are finding new ways to provide products and services that help these underserved people. Yet, often startups lack the capital and strategic support they need to grow and scale their impact. Accion Venture Lab addresses this need."
"There is strong potential for inclusive fintech startups to reach historically underserved communities while generating returns, and the oversubscription of the Accion Venture Lab fund is great validation of our early work investing in more than forty innovative businesses operating in thirty markets," said Venture Lab managing director Vikas Raj. "This new pool of capital enables us to scale our efforts and remain at the forefront of seed stage investing in inclusive fintech."
(Photo credit: Accion)