Equity, Venture Capital and Quasi-equity

Socially and economically important projects may lack the scale or capacity required to qualify for commercial finance. They may also be nascent projects or technologies which are yet to mature within the markets and cannot therefore pass the “proof of concept” tests required to qualify for debt finance.

Further, a large number of enterprises within the Bank’s member states require equity or venture capital rather than debt funds, due to undercapitalisation and lack of appropriately priced resources. Given the significant demand from such companies and the specialised nature of the support required to enable such businesses to become viable, the Bank will render support through carefully selected equity and venture funds.

EADB also plays a catalytic role by attracting other development partners to invest in such projects. In exceptional cases, the Bank invests directly into larger enterprises with significant social and economic impact subject to a clearly defined investment period exit mechanism.