NEW YORK | July 19, 2023 ― The Rockefeller Foundation released its annual Zero Gap Fund: 2022 State of the Portfolio report capturing the crucial role that catalytic capital plays in enabling investment solutions to solve the world’s most pressing challenges. Across its 10 investments as of December 2022, the Fund has contributed to the mobilization of more than $795M in private finance toward a diverse portfolio of high-impact investment strategies. The Fund added two investments in 2022, bringing total commitments to $25 million of the $30 million fund. As of July 2023, the Fund is fully committed across 12 investments.
The Zero Gap Fund was launched in 2019 in partnership with the John D. and Catherine T. MacArthur Foundation and the Catalytic Capital Consortium (C3) to promote investment in scalable and innovative impact-driven investment solutions. The fund deploys patient, risk-tolerant, and flexible capital into promising financial strategies and mechanisms that seek to boost large-scale private investment to advance the UN Sustainable Development Goals (SDGs), including ensuring healthy lives, achieving gender equality, and promoting full, productive employment.
“Innovative financial mechanisms like those supported by the Zero Gap Fund demonstrate the power of investment capital that is willing to come in early and bolster impact-driven solutions and strategies that can help people respond to climate change and other crises, while regaining the progress the world was making in eliminating poverty, reducing hunger, and more,” said Maria Kozloski, Senior Vice President, Innovative Finance, The Rockefeller Foundation. “As the Zero Gap Fund’s portfolio matures, we are seeing proof of concept for solutions and strategies that marry social impact and financial returns, with the potential to mobilize significant private capital.”
“Through our 50-50 investment partnership with Rockefeller in the Zero Gap Fund, we are demonstrating a new form of philanthropic collaboration, while unlocking additional capital to address pressing social, economic, and environmental challenges,” said Debra Schwartz, Managing Director for Impact Investments at MacArthur. “We are excited about the fund’s progress and anticipate outsize impact and influence going forward.”
Zero Gap Fund Impact Highlights:
- Forest Resilience Bond enables the restoration of forests and assures water quality for farmers and communities threatened by wildfires. In 2022, it has helped to avert 1,791 metric tons of CO2 emissions, funded restoration for 176 acres of fire-prone areas in California and protected 527 acres of terrestrial ecosystems.
- LeapFrog’s Emerging Consumer Fund III provides access to financial services and healthcare for emerging consumers in Sub-Saharan Africa, South Asia, and Southeast Asia. Through its portfolio companies, the fund has delivered essential healthcare services to 166 million emerging consumers and enabled more than 94,000 jobs as of 2022.
- CRAFT finances solutions for climate adaption and resilience to improve the lives of under-served communities globally. Through its investments, it has successfully reduced 395,000 tons of net GHG emissions, while serving more than 16,000 beneficiaries as of 2022.
- Women’s Livelihood Bond 2 (WLB2) provides capital and other assistance to women-owned businesses in Southeast Asia. It has directly reached more than 88,000 women emerging consumers and helped more than 3,000 women access financial literacy training as of 2022.
- Founder’s First Capital Partners provides revenue-based financing to underfunded and underrepresented entrepreneurs across the United States. As of 2022, the company deployed $4.3 million across 15 loans with an average size of $288,000. 50% of loans went to ethnic minorities, 25% to women, 17% to veterans, and 8% to low/moderate-income communities.
- Apis & Heritage enables job preservation and asset ownership for low-income and minority workers in the United States through employee ownership. It announced its first two purchases of companies using an employee-led buyout model, helping 170 existing workers to build wealth through ownership of the businesses where they work while creating 60 new jobs.
- Seedstars International Ventures II is a seed-stage venture fund that invests in tech-enabled startups across emerging and frontier markets globally. Seedstars has committed $1.8 million across 11 portfolio companies creating 205 new full-time positions.
- Horizon Capital is Ukraine’s leading private equity firm, invests in innovative, export-oriented, asset-light technology companies that can withstand volatile macro environments. ZGF’s investment will enable Horizon to continue investing at a time when capital is most needed to fund globally competitive companies in the region. The fund’s hard cap is targeting $300 million to invest in technology companies in Ukraine, with up to 20% allocated to Moldova.
About The Rockefeller Foundation
The Rockefeller Foundation is a pioneering philanthropy built on collaborative partnerships at the frontiers of science, technology, and innovation that enable individuals, families, and communities to flourish. We make big bets to promote the well-being of humanity and make opportunity universal and sustainable. Our focus is on scaling renewable energy for all, stimulating economic mobility, and ensuring equitable access to health care and nutritious food. For more information, sign up for our newsletter at www.rockefellerfoundation.org and follow us on Twitter @RockefellerFdn.
About the John D. and Catherine T. MacArthur Foundation
The John D. and Catherine T. MacArthur Foundation supports creative people, effective institutions, and influential networks building a more just, verdant, and peaceful world. MacArthur’s Impact Investment program is working to build the field of impact investing and provide catalytic capital to address social and environmental challenges around the world. MacArthur supports the Catalytic Capital Consortium, an investment, learning, and market development initiative conceived of in partnership with The Rockefeller Foundation and Omidyar Network to demonstrate the power of catalytic capital and to expand its use.
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