Accion Venture Lab has launched a new $23 million inclusive fintech fund. The new fund is made possible by co-investment from third-party impact and commercial investors including, the Ford Foundation, Visa Inc., and FMO (The Netherlands Development Finance Company).

With an additional, separate $10 million investment from Accion—the parent company of the Venture Lab, the fund being managed by Accion Venture Lab, which was launched in 2012 with $10 million capital, has increased to $43 million.

According to a statement released by Accion Venture Lab on Wednesday, the new fintech fund will be used to make seed-stage investment in inclusive fintech startups leveraging technology to increase the reach, quality and affordability of financial services for the underserved communities.

Other investors in Accion Venture Lab are ImpactAssets Giving Fund of Blue Haven Initiative, Heifer Foundation, MetLife Foundation, Open Society Foundations, Pace Able Foundation, Proparco—French Development Agency (AFD)'s private sector financing arm, Prudential Financial, and Stichting Hivos-Triodos Fund—managed by Triodos Investment Management.

There is a strong potential for inclusive fintech startups to reach historically underserved communities while generating returns, and the oversubscription of the Accion Venture Lab fund is a great validation of our early work of investing in more than 40 innovative businesses operating in 30 markets," said Venture Lab Managing Director Vikas Raj. "This new pool of capital enables us to scale our efforts and remain at the forefront of seed-stage investing in inclusive fintech."

In the past seven years, Accion Venture Lab has invested in 36 startups. Out of these 36 startups, six are in Africa—one in Nigeria (Lidya), three in Kenya (Apollo Agriculture, Kopo Kopo, and Pula) and two in South Africa (Lulalend and Lumkani).

For every dollar invested, Accion Venture Lab says its portfolio companies have raised an additional $13 in equity capital from later-stage investors. For instance, Accion Venture Lab invested $1.25 million in Lidya in 2017, and one year later, Lidya raised $6.9 million in Series A investment.

In the past three years, Accion Venture Lab has also supported the Lagos Startup Week. At the 2017 edition, it held a Customer Acquisition masterclass. This year's Lagos Startup Week is themed, "Collaboration" and it is scheduled to hold on September 23-28.

Inclusive fintech startups, per Accion Venture Lab, face the same challenges as other entrepreneurs, including tight profit margins, competition and regulation. The Venture Lab, therefore, provides these startups with capital, strategic and operational support. For most of its portfolio companies, Accion Venture Lab was the first investor.

We're seeing substantial growth in the amount of investment capital available for fintech startups from what we saw when Accion Venture Lab launched in 2012, but money isn't enough, said Venture Lab Managing Director Tahira Dosani. "Capital must be paired with strategic and operational support that is informed by a deep knowledge of the sector, target customer, and a deliberate focus on how new technologies can help the underserved build better lives. We can accelerate the growth trajectory of companies through our capital plus approach to investing.

The mission of Accion, which is a non-profit, is to create a financially inclusive world. It aims to achieve this through microfinance banking and fintech impact investing. Hence Venture Lab, its seed-stage investment initiative, invests in startups serving the underserved communties, through insurtech, agricultural finance, digital lending, personal finance management and small and medium enterprises finance solutions.

Accion also partners with other organisations that share its financial inclusion commitment. Such organisations include Quona Capital—a leading growth stage venture firm focused on fintech for inclusion in emerging markets—and Inclusive Fintech 50, an initiative which elevates early-stage fintechs addressing financial inclusion.