LeapFrog Investments, the Profit with Purpose firm, has closed its fourth fund (“Fund IV”), with commitments totalling $1.02 billion from its initial target of $1 billion to accelerate high-impact healthcare and financial services companies in global growth markets.
The fundraise includes $808 million of primary fund commitments and up to $210 million of pre-allocated co-investment Alongside an additional partnership with Prudential Financial (to invest in leading African financial services firm Alexander Forbes), this brings new allocations to the firm’s healthcare and financial services strategies across the recent fundraising cycle to over $1.15 billion.
Separately, LeapFrog also recently launched a new climate investing strategy to provide green tools and technologies across Africa and Asia.
According to Andy Kuper, Founder and CEO, LeapFrog Investments: “What LeapFrog’s team has achieved in this fundraising cycle is phenomenal, attracting world-class institutional investors, many from new markets, to our distinctive Profit with Purpose strategies.”
Recent years have seen one of the most challenging fundraising cycles for private equity this century, with capital raised in 2023 the lowest in the past six years. Yet, according to Kuper, LeapFrog has been able to distinguish itself through deep local sourcing and industry insight, distinctive value creation, authentic impact management and ultimately robust results.
“We will continue to build this magnet for forward-looking global investors. Together, we are in a unique position to pursue strong returns and positively change millions of lives,” Kuper added.
Cornerstone investors for LeapFrog’s latest fund include top-tier institutional limited partners such as Temasek, AIA, Prudential Financial, and development financial institutions, including the European Investment Bank and the U.S. International Development Finance Corporation. LeapFrog also drew significant commitments from global asset managers such as Sumitomo Mitsui Trust Bank and Van Lanschot Kempen, healthcare strategic investor Eli Lilly and Company, and foundations and endowments such as the Ford Foundation and the IMAS Foundation, a purpose-led independent asset manager supporting INGKA Foundation’s key objective to fund IKEA Foundation’s long-term philanthropic programs.
In addition to strong support from long-standing LeapFrog investors in prior funds, Fund IV also raised a significant amount of capital from new investors and broadened its investor base into new markets including Singapore, China, Japan, Austria, Norway, Oman and Turkey. These relationships provide the foothold for LeapFrog to further promote authentic impact investing in diverse regions, expanding the commercial success and mission of impact investing across the globe.
Fund IV aims to support 100 million emerging consumers and producers to build better lives and has already reached 24 million (a 40% increase since investment) through five initial companies. All five investees have achieved strong revenue growth over the past year.
They include Redcliffe Labs, one of India’s largest and lowest cost diagnostics businesses, Insurtech innovator bolttech, an embedded insurance platform, Electronica Finance helping power rapid MSME growth in India with loans for machines, equipment, rooftop solar and other purposes, Auxilo Finserve, a higher-education lender in South Asia and Sun King, the world’s largest off-grid solar financier that has provided 118 million people with access to solar energy, in the process saving low-income households over $7.2 billion in energy expenses that would otherwise have paid for biomass, kerosene lamps and diesel generators.
“LeapFrog’s mission is underpinned by our committed, commercially astute, and socially responsible limited partners. We want to thank those investors today for putting their faith in the LeapFrog team to deliver strong risk-adjusted returns across exciting, innovative businesses in high-growth markets. Fund IV will be instrumental in scaling the impact champions of the future in financial services and healthcare, as well as building future prosperity and economic resilience for emerging consumers,” Dominic Barton, Chairman, LeapFrog Investments.