Proparco, alongside CDC Group, DEG, European Investment Bank, FinDev Canada, FMO, SIFEM and SwedFund International, have signed a Memorandum of Understanding with Development Partners International LLP (DPI), a leading pan-African private equity firm with $1.7 billion of assets under management, to become the first 2X Flagship Fund.
2X Flagship Funds are part of the 2X Challenge, a multilateral initiative launched by the DFIs of the G7 countries, with the objective of mobilizing $3 billion to support projects that empower women and enhance their economic participation. Vehicles awarded status as 2X Flagship Funds are established, high performing private equity funds, focused on emerging markets, that have committed to investing with a gender lens using the 2X criteria.
With ADP III qualifying as the first 2X Flagship Fund, DPI is affirming its clear and long-standing commitment to advancing women’s economic empowerment and promoting gender equity both at DPI and within its portfolio companies in ADP III. Applying a gender lens helps investors unlock the multi-trillion-dollar opportunity that women represent in the global economy – as earners, women have a multiplier effect by reinvesting their income to grow their businesses, buy goods and services and improve the welfare of their families and communities. Current estimates indicate that women control 70-80% of consumer spending decisions, estimated at approximately $40 trillion globally (See Silverstein and Sayre, 2009: The Female Economy, Harvard Business Review)
DPI and all DFI members of the 2X Challenge recognise that in the private sector, gender equity drives higher performance and increased employee engagement - gender-balanced management teams typically demonstrate 10-20% higher returns (See IFC Report, 2019: Moving Toward Gender Balance in Private Equity and Venture Capital). DPI’s leadership team has strong representation of women in key roles, led by CEO and co-founder, Runa Alam, with 50 per cent of all Partners at the firm and of the Investment Committee being women.
Runa Alam, co-founder and CEO of DPI said, “We are extremely proud to be the first 2X Flagship Fund in the 2X Challenge, which reaffirms our commitment to advancing senior women and developing the pipeline of female talent in private equity. Working closely with our portfolio companies, we want to emphasize the benefits that gender-focused investing can provide, not just in terms of returns, but in helping to drive economies, unlock opportunities, and improve the quality of life for women across Africa. For DPI, signing on as a 2X Flagship Fund, is an important and natural step to reinforce our long-standing commitment to gender equity.”
DPI has been a long-term CDC partner since CDC’s investment in DPI’s inaugural fund in 2008. More recently, CDC anchored ADP III with an $80m commitment.
Natou Bamba-Colon, Head of Development Effectiveness team at Proparco said: “As one of the founding members of the 2X Challenge, Proparco is very proud to support DPI’s long-standing commitment towards gender-balanced equity. ADPIII strongly qualifies to be the first 2X Flagship Fund. The 2X Challenge has been a great success in building gender lens investment standards for the private sector and in particular for private equity funds such as DPI. We are convinced DPI’s investing activities can contribute to women empowerment and women inclusion by increasing female participation in formal and productive SMEs activities, and facilitating access to essential inputs.”
Jen Braswell, Director, Value Creation Strategies at CDC Group, said, “In only two years, the 2X challenge has mobilized a total $4.5 billion in gender-smart investments, and now we have launched the very first 2X Flagship Fund with DPI. This represents a key milestone in our work to build the field of gender finance and to empowering women through our investing. We hope that DPI’s commitment will demonstrate to the private equity industry that adopting a gender lens is consistent with a commercial investing strategy and adds real value to an emerging markets portfolio.”