Washington, DC, June 30, 2021—To help identify and scale innovative tech solutions for today's most pressing global challenges across emerging markets, IFC is partnering with The Engine, the venture capital firm founded by the Massachusetts Institute of Technology (MIT). IFC will invest $20 million in The Engine Fund II, which will support Tough Tech companies (also known as Deep Tech), a category of startups that aim to develop and commercialize complex scientific or engineering discoveries that can solve the world's most challenging problems such as in human health, energy access, and climate change.
The Engine provides the companies with the capital and expertise needed to allow effective development and commercialization of foundational, technology-based global solutions, which often require specialized resources and longer periods of research and development due to their complexity. IFC will facilitate their scale-up and expansion across emerging markets, where tech innovations can have an even greater impact.
"Solving many of today's toughest development challenges requires cutting-edge scientific innovations that reach the people who need them most," Makhtar Diop, IFC's Managing Director. "Complex technologies that can help prevent disease, bring clean-energy to off-grid communities, and reduce carbon emissions require strong investment support to dedicate the time, effort and brilliant minds needed to bring these ideas to market."
According to a BCG-Hello Tomorrow report, investment in deep tech grew from $15 billion in 2016 to over $60 billion in 2020. The COVID-19 crisis has further accelerated the trend by pushing institutions around the world to boost investment in research and development of new technologies that can help address critical challenges in healthcare and pandemic response.
"Tough Tech is critical to addressing significant global challenges, but the ecosystem required to support it is extremely complex; it involves cutting-edge universities and research, innovative entrepreneurs, and visionary investors who are willing to believe in and back fundamentally new ideas that call for radical change but represent tremendously positive potential outcomes," said Katie Rae, CEO and Managing Partner of The Engine. "This is where leading impact investing institutions like IFC play a key role by bringing long-term capital and the convening power needed to conceive and commercialize new technologies from lab to market."
Over 40% of the portfolio companies from The Engine's first fund are founded or co-founded by women, reflecting the fund's commitment to supporting diverse leadership in a historically male-dominated field like Tough Tech. The Engine's Fund II will continue to invest in and nurture a diverse pool of talented entrepreneurs, including female and underrepresented minority founders.
IFC joins MIT and Harvard University as investors in The Engine Fund II, bringing the firm's total capital commitments across the two funds to $515M.
The Engine Fund II follows Fund I, which was launched in 2017 and supports a wide range of Tough Tech solutions ranging from energy storage systems that can help manage renewables variability to a platform that analyzes wastewater to help communities monitor health indicators.
ABOUT THE ENGINE
The Engine, launched by MIT, is a Cambridge, MA-based venture capital firm that invests in early-stage Tough Tech companies solving the world's biggest problems through the convergence of breakthrough science, engineering, and leadership. It provides the capital, knowledge, connections, as well as the specialized equipment, space, and labs these transformative startups need to thrive. For more information, visit www.engine.xyz.
ABOUT IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2020, we invested $22 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org.
Stay Connected
www.facebook.com/IFCwbg
www.twitter.com/IFC_org
www.youtube.com/IFCvideocasts
www.ifc.org/SocialMediaIndex
www.instagram.com\ifc_org
Contacts
Stay Informed
Sign up to have customizable news & updates sent to you.