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LeapFrog Investments Raises $400M For Africa, Asia Fund

LeapFrog Investments Raises $400M For Africa, Asia Fund

Written by Swati Pandey | From Reuters

LeapFrog Investments, a private equity firm backed by George Soros and JP Morgan, said it has raised $400 million for socially responsible investments in Asia and Africa – the largest ever for a fund specialising in low-income emerging market financial services.

The fund, LeapFrog’s second such fund, was three times the size of first raised and was oversubscribed, underscoring the increasing popularity of so-called “impact investing”.

Investors include Australian superannuation funds, American International Group, Europe’s second-biggest insurer AXA and Swiss Re.

“Here you have these institutions seeing that there is an enormous opportunity in the emerging consumer – people who have yet to enter the middle class, and that’s a big deal,” said Andrew Kuper, LeapFrog’s Sydney-based chief executive.

LeapFrog, with over $500 million of assets under management, has small-ticket investments in companies providing insurance, savings, pensions and payments services – usually for customers earning under $10 a day.

LeapFrog estimates that worldwide, the annual collective spending power of such customers will rise to $5 trillion by 2022 from around $2 trillion in 2012.

It also invests in markets most players refrain from. For example, it has a stake in South Africa’s All Life, which provides insurance cover to HIV patients.

Investment bank JPMorgan and think tank Global Impact Investing Network estimate there is $46 billion in impact investments under management. While experts say this figure is growing, it is only a fraction of the $210 trillion invested in financial markets around the world.

Read more at Reuters