UOB, Credit Suisse hit $60m first close on Asia impact fund

The fund – which is known as the Asia Impact Investment Fund II (AIIF II) and has a full target of $100 million – received commitments from global family offices and high net worth individuals, as well as from UOB itself. A final close is expected next year. It will make equity investments of $1-15 million in privately held, high growth companies across agriculture, education, healthcare, and logistics.

The broad impact priority is improving the well-being and livelihoods of low-income communities, defined as the base of the economic pyramid. These are typically communities in rural or remote areas that lack infrastructure and access to basic facilities to meet their basic needs. More specifically, the fund is interested in improving access to affordable housing, sanitation, clean water, and energy.

Past investments include TaniGroup, an Indonesia-based agricultural technology start-up. The company has evolved from a direct-to-consumer e-commerce platform for fresh produce into an end-to-end supply chain player that connects farmers with commercial buyers. It has also launched a P2P financing platform for farmers. UOBVM took part in a $17 million extended Series A round earlier this year.

The first impact fund closed at $60 million in 2016, with UOBVM serving as fund manager and Credit Suisse as impact advisor. To date, more than 15 million low-income individuals have benefitted from the efforts of portfolio companies. Addressable needs are rising as COVID-19 exacerbates global poverty, with the World Bank estimating that 150 million more people will be pushed into extreme poverty by 2021. Tens of millions of these will be in Southeast Asia, according to the UN.

“The success of the AIIF I and the momentum of the AIIF II to date reflects investors’ growing emphasis on sustainability. While we seek to achieve quality financial returns for our investors, we also continue to partner them in generating positive social impact by helping the vulnerable segments of the community across Southeast Asia and China,” Seah Kian Wee, CEO of UOBVM, said in a statement.

Impact investing is becoming increasingly mainstream, with an assortment of global private equity firms raising capital for the space based on double bottom-line mandates to achieve meaningful social impact and financial returns. Among Southeast Asian investors, Temasek Holdings is another early mover. Last year, it launched ABC World Asia, which is pursuing an impact strategy in developing Asia.

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• Topics
• Southeast Asia
• Growth
• Fundraising
• UOB Venture Management
• Impact investment
• ESG