DFI sponsorship of new platforms and ventures: Why and how? Synthesis report

Development finance institutions (DFIs) face significant challenges in addressing unmet development needs, particularly in smaller, lower-income countries with few large firms and high investment risks, and in sectors with few private operators. In response, some DFIs, like British International Investment (BII) and Norfund, have initiated new commercial ventures themselves, developing concepts, raising capital, and managing operations. These ventures aim to generate critical investments in sectors such as infrastructure, healthcare, and agriculture, often in challenging markets. Examples include Gridworks, which by investing in power transmission and distribution, is expanding electricity access in Burundi and the Democratic Republic of Congo, and MedAccess, which provides guarantees which reduce the cost of medical products in Africa. By sponsoring new ventures, DFIs can scale up their development impact and reach, particularly in difficult markets, as well as their mobilisation of private capital. This report is intended to contribute to DFI learning about how to do this effectively. It may also be of interest to foundations and impact investors keen to play a more active role in sponsoring the creation of high-impact enterprises.