IDB Invest, a member of the IDB Group, has provided an equity investment in the SEAF Caribbean SME Growth Fund of up to US$10 million or 20 percent of the fund’s total commitments, or the lesser of the two. The investment will contribute to the development of the Caribbean private equity investment ecosystem.
The fund aims to provide risk capital to growth-oriented companies in the English-speaking countries of the Caribbean Common Market (CARICOM), which has become even scarcer due to the COVID-19 crisis. The fund can invest in Suriname as well. The fund has a broad strategy but focuses on the following key prospective sectors: manufacturing, agribusiness, healthcare, training and education, information and communication technology, financial inclusion, renewable clean energy services, retail distribution, and transport and logistics.
In addition, IDB Invest mobilized a US$10 million blended finance loan to support the fund’s portfolio companies in the implementation of eligible climate resilience, climate change mitigation and post-disaster recovery projects with resource from the Canadian Climate Fund for the Private Sector in the Americas – Phase II (C2F). Also, IDB Invest will provide advisory services to portfolio companies regarding corporate governance, climate change and local value chains.
The primary development objective is to promote the growth and productivity of growth-oriented Caribbean small and medium enterprises (SME) that generate positive development results through their business activities. By combining equity financing and strategic expertise, the fund is expected to boost the companies’ local and regional expansion as well as their operational efficiency, ultimately contributing to job creation, productivity increase, and integration in the Caribbean region.
Bert van der Vaart, co-founder and co-CEO of SEAF, states, “SEAF believes that significant opportunities exist in the Caribbean region for growth and impact as we emerge from the effects of the COVID pandemic, and we are delighted to be working with IDB Invest to be investing in fast growing SME there in combination with active business partnership.”
Therese Turner-Jones, General Manager for IDB’s Caribbean Country Group and Jamaica’s Country Representative noted, “SME have always been powerful drivers of economic activity and equality in the Caribbean. And this investment in the SEAF Caribbean SME Growth Fund comes at a time when Caribbean businesses need all the help they can get to not only recover from the effects of the COVID-19 pandemic, but also harness new opportunities from the crisis.”
James Scriven, CEO of IDB Invest said, “We are proud to join forces with an experienced impact investor like SEAF to unlock sustainable growth at this critical time in the Caribbean, generating more jobs and promoting development.”
This project potentially contributes to seven United Nations Sustainable Development Goals (SDGs): primarily, Decent Work and Economic Growth (SDG 8), as well as Gender Equality (SDG 5), Affordable and Clean Energy (SDG 7), Industry, Innovation and Infrastructure (SDG 9), Reduced Inequalities (SDG 10), Climate Action (SDG 13), and Partnerships for the Goals (SDG 17).
About IDB Invest
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region. With a portfolio of $13.1 billion in asset management and 385 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
For more than thirty years, SEAF has been a leader in impact investing in emerging and frontier markets. SEAF has raised $1.2 billion in cumulative capital across more than forty funds and has made more than 430 investments in small and medium-sized enterprises, driving value-added growth and innovation while promoting gender equality and ESG best practices. The SEAF Caribbean SME Growth Fund will invest in local entrepreneurs who help their communities grow, building resilience with a focus on climate, food security and inclusion.