LeapFrog Investments, a private equity firm specializing in impact investing, has announced its plans to raise $1 billion for a new fund aimed at supporting businesses in the financial and healthcare sectors in “global growth markets.” The fund, known as the Emerging Consumer Fund IV, has already secured commitments from institutional investors, including the European Investment Bank (EIB) and the World Bank’s International Finance Corporation (IFC).
Key Takeaway
LeapFrog Investments is raising
billion for its new fund, the Emerging Consumer Fund IV, to invest in high-growth businesses in the financial and healthcare sectors in Africa and Asia. The firm plans to take control-oriented significant minority or majority stakes in 18 to 20 targeted businesses and actively support their growth and impact.
Investor Commitments and Partnerships
Among the institutional investors backing the fund are the EIB and IFC, which have committed $60 million and $50 million, respectively. Financial services companies Prudential Financial and AIA Group have also made substantial investments of $500 million and $200 million, respectively. The support from leading global investors underscores the appeal and potential of emerging markets in Africa and Asia.
Strategic Investments and Geographic Focus
LeapFrog Investments plans to make initial investments ranging from $30 million to $70 million in approximately 18 to 20 high-growth businesses. The firm will allocate approximately 40% of the funding for investments in Africa, with a particular focus on healthcare and financial services businesses. Additionally, the fund will also target opportunities in South Asia and Southeast Asia.
Daniel Stacey, LeapFrog’s Global Head of External Affairs, emphasizes that the firm’s investments are more than just financial contributions. LeapFrog actively engages with the leadership teams and boards of the businesses it supports, providing knowledge, experience, and follow-on funding to help them achieve their growth, profitability, and impact targets.
Previous investments made by LeapFrog in Africa include Sun King, a leading off-grid solar energy company, and Jumo, a South African fintech startup. In India, the firm has invested in Redcliffe Labs, a mobile diagnostics chain, and bolttech, an insurtech unicorn.
Target Sectors for Growth
LeapFrog is specifically interested in financial services companies operating in areas such as life insurance, wealth management, banking, credit, and digital financial services. In the healthcare sector, the firm is focused on diagnostics, wellness and chronic care managers, retail pharmacies, single-specialty providers, manufacturing and distribution of medical devices, and digital health services. The firm sees significant opportunity for growth in these sectors, driven by the increasing penetration of smartphones and improvements in digital distribution and AI-backed treatment models.
LeapFrog’s long-term view is that these sectors present trillion-dollar opportunities with the potential for sustained growth over the coming decades. Through its new fund, the firm aims to support businesses that are not only financially successful but also create positive impact and improve the lives of low-income consumers.
