In an announcement made Friday, Alix Zwane has been named to lead the young and ambitious initiative forward. Zwane most recently served as chief executive of Evidence Action and has previously worked on strategic philanthropy at the Bill & Melinda Gates Foundation and as an academic researcher conducting randomized control trials.
The $200 million instrument was launched by the U.S. Agency for International Development, the U.K. Department for International Development, Swedish aid agency SIDA, the Australian Department of Foreign Affairs and Trade and the Omidyar Network with the goal of providing early stage capital to innovative ideas that tackle some of the world’s greatest challenges and have the potential to scale.
“This is very much the mission that I have devoted my career to — the premise that in an era of inequality and tight budgets in developing countries and an era in which the aid landscape is changing and traditional bilateral aid is a smaller and smaller piece of the pie we need new ways to solve thorny challenges and we need to be able to convincingly tell stakeholders that there’s value for money in the investments that are being made,” Zwane said.
Since the fund was launched, more than 2,100 proposals have been submitted from 110 countries and 16 different sectors. The diverse group of applicants have ranged from governments to academics, to firms, nongovernmental organizations and individuals. The demand has confirmed the hypothesis that led to the creation of the GIF that there is a large gap in risk capital across all sectors.
So far the fund has evaluated about 98 percent of the applications it has received by putting them through a social and technical appraisal process and having risk committees evaluate the investment. The fund will continue accepting applications on a rolling basis but recently issued some tips for those interested in applying. The GIF is looking to fund proposals that provide a better alternative to the standard development process, measure social innovation, have a clear path to scale and have a strong team in place.
The GIF has been operating as the startup that it is — accepting applicants, developing policies and refining processes as they went, said Jeff Brown, who has led GIF’s interim team.
“This approach has a lot of promise for the taxpayer and for the global poor, but there’s a reason few others would try this,” he said. “It is a big mandate.”
It also presents great opportunities to introduce new tools to the development tool box, said Brown, who will leave his post shortly after Zwane takes the reins.
Zwane’s appointment is clearly a key moment for the young organization, and in an exclusive interview with Devex, she said she’s looking forward to the task — challenges and all. Here are excerpts from that interview:
What are you most looking forward to as you take the helm of the Global Innovation Fund?
I have spent my career working on the premise that we need new ways to make sure that development aid is additive, catalytic and good value for money. Part of the way we’re going to get to that solution is with innovation and the other way is with rigorous evidence as to what works. What’s incredibly exciting to me about GIF is that this is a new fund that complements traditional foreign aid, which of course will always continue to be important but can’t always be very nimble. It also complements private capital by our focus on rigorous evidence-based approaches to really helping the poorest.
So what I’m looking forward to is a GIF that is nimble, that supports innovation and new ideas and really doesn’t compromise on saying that the things that we fund and that we support and that we help scale are backed by rigorous evidence that they really have impact. And I think there is a clear mandate on that. … It’s a really unique combination that brings a new way of working to the aid and philanthropy landscape.
What do you think will be your greatest challenges?
One challenge I think will be to go at the right pace. We want to go fast and take advantage of the opportunities that we have as GIF when people are increasingly interested in innovation for development and evidence-based programs. On the other hand, it takes time for investees and grantees to deliver results and we want to be thoughtful helpful partners to these people and so we have to balance the interest in speed, high expectations and the reality that social change and delivering on innovation really can take time.
I think a second challenge will be to maintain our startup mentality and to stay lean and nimble but do a thoughtful job of managing risk and a thoughtful job of managing taxpayer resources, which we are so fortunate to have at our disposal at GIF.
I think that this board is really committed to maintaining the things that make GIF unique and that’s definitely I think the mandate they’ve given to me. So I’ll be working hard to make sure we do mitigate risk appropriately, stay unique and catalytic and don’t duplicate efforts of others.
One of the unique things about the GIF is that it’s not specific to a certain geography or issue area but it has a broad mandate to supporting innovations that tackle a specific problem. How do you go about selecting grantees across such a broad spectrum?
That will be a great challenge for us to learn more about over time. It is one of the things that makes GIF unique. We’re excited about it but it will also be one of the challenges we make sure we take on thoughtfully and carefully and learn more about over time. We certainly don’t have that all figured out but we’ve got great networks of technical advisers and technical reviewers and a unique system of evaluating investments and grants that relies on content expertise thoughtfully and carefully even if we don’t have all the content expertise in house that we need.
How do you see the GIF fitting into the broader post-2015 development landscape and to financing for development?
The fund is really designed and intended to fill gaps in the development space — to de-risk and feed the pipeline of impact and commercial investors, to support rigorous testing, and [to hand] off successful projects to donors and national governments. This is and will always be the particular niche in which the fund works rather than taking on things that could be done by others. The second point I make on that front is that the [sustainable development goals] are holistic in nature and as the development community rallies around them and thinks carefully about really what investments need to be made to achieve the SDGs it’s quite likely that the interest in innovation, value for money [and] evidence-based programming will only grow as we take seriously our obligations under the SDGs.
What have you learned about taking innovation to scale that could be useful to innovators and entrepreneurs?
I would highlight two lessons that I think will be relevant for a lot of partners of GIF. The first is to continue to learn and continue to iterate and continue to test. And by iterate and learn I don’t mean randomized control trials, but continuously pressure testing one’s business model to see If there are ways to refine your service delivery approach. … The second lesson is to truly understand your costs of doing business and to continue to understand how those costs vary over time, by geography [and] by staffing model, so that you’re able to access financing beyond grant funding and really be confident that you understand your business and can take on innovative financing.
What does success look like? What will be your first steps?
It has been a very busy time over the past year with Jeff at the helm. They have really built the pipeline of investments at the fund … announcing investments will certainly happen in 2015. We’ve got more investments to evaluate and we need to improve our own evaluation processes and we have lots of recruiting to do. GIF is very much a startup with all the things that go with that so we need to build our infrastructure, build up our team and continue to assess fantastic investments that are already in our pipeline.
Join Devex, the largest online community for international development, to network with peers, discover talent and forge new partnerships — it’s free. Then sign up for the Devex Impact newsletter to receive cutting-edge news and analysis every month on the intersection of business and development.