LeapFrog Investments has announced the close of its third emerging markets-focused impact fund at $700 million, surpassing its initial target of $600 million, according to a press release.
The new fund targets to invest in healthcare and financial services companies – tapping into the demand of billions of emerging consumers in Asia and Africa. This fund seeks to reach 70 million emerging consumers.
The new fundraise will take LeapFrog to $1.6 billion of total commitments, making it the largest private equity manager dedicated to impact investing.
Leapfrog has already started investing from the third fund and has made five investments so far. It has backed digital remittances provider WorldRemit, African healthcare services provider Goodlife Pharmacy and drug distributor Pyramid Pharma.
In India, the vehicle has invested in NeoGrowth that provides innovative unsecured-credit products to micro, small and medium enterprises, and Ascent Meditech, that manufactures and delivers orthopaedic products.
Investors in the new fund include leading global insurers, pensions and asset managers, development finance institutions, foundations and family offices.
“Prudential’s lead investment in LeapFrog’s latest fund underscores our conviction in the power of capital-based solutions to solve the financial, social, environmental, and economic challenges of our changing world,” said Charles Lowrey, Chairman and Chief Executive Officer of Prudential Financial, Inc.
Other LPs in the fund include insurers such as Admiral, AIG, AXA XL, Everest Re, Hannover Re, QBE and Zurich. The vehicle also saw the backing of leading pensions and asset managers such as Ascension Capital, Pinebridge and TIAA-Nuveen (USA), Kempen, Partners Group Impact, Stiftung Abendrot and SBZ (Europe) as well as Christian Super and HESTA (Australia).
Development financiers such as Germany’s DEG, IFC and France’s Proparco are also coming on board as LPs.
Merck & Co, and foundations including PactWorld, the Ford Foundation and the Rockefeller Foundation constitute other major investors.
“It is time for a better kind of capitalism,” said Andrew Kuper, Founder and CEO, LeapFrog Investments. “As our third fund and largest fund, it is a decisive demonstration that meeting the real needs of under-served people is great business.”
LeapFrog has so far invested in 26 businesses. Its portfolio companies now reach 168 million people across 35 countries with healthcare or financial services, of which over 136 million people are emerging consumers – defined by The World Bank as living on under $10 a day.
Most of them are accessing quality insurance, savings, pensions, credit, remittances, medicines or healthcare services for the first time. Many sectors that facilitate social causes are at a nascent stage that offer enormous potential for inclusive growth and shared prosperity.