IDB Lab
  • IDB Lab is the innovation and entrepreneurship laboratory of the Inter-American Development Bank Group, whose mission is to improve lives in Latin America and the Caribbean (LAC).
  • The purpose of IDB Lab is to find new ways to drive social inclusion, environmental action and productivity in the region. To do so, IDB Lab addresses the low levels of innovation and technology adoption in LAC by tackling specific barriers around two categories: limited financing for innovation, and underdeveloped innovation ecosystems.
  • IDB Lab mobilizes financing, knowledge, and connections to support early-stage entrepreneurship, foster the development of new technologies, activate innovative markets, and catalyze existing sectors.
  • Although it is the smallest of the three IDB Group entities, it occupies a strategic position as a testing ground for the expansion of emerging technologies and innovative business models that can achieve greater impact at scale.
  • IDB Lab has been designed to have a higher risk appetite, faster execution speed, and greater ease of adaptation compared to the IDB and IDB Invest. This enables IDB Lab to serve in a unique way clients in the entrepreneurial space (startups, VC funds, accelerators, etc.) that play a crucial role in exploring and promoting new approaches to drive social inclusion, environmental action, and productivity.
  • IDB Lab's knowledge and experience in emerging markets allows the other IDB Group windows to be pioneers or more relevant in their respective fields. Some examples are natural capital, migration, sanitation prototypes, artificial intelligence, the silver economy, and blockchain.
  • IDB Lab connects innovation with the public sector by working with the IDB to create opportunities to improve income and access to quality essential services for people living in poverty and vulnerability. 
  • The IDB Group's offer to the private sector contemplates a continuum of financing between IDB Lab and IDB Invest to support the innovation cycle of businesses from early stages to scale.
  • IDB Lab has helped catalize crucial sectors that offer skills training, financing, clean energy and other productivity enhancing services to poor and vulnerable populations. It is currently driving disruptive technologies and business models to transform the health, labor markets, agriculture, and finance sectors, making them more accessible and sustainable.
  • The IDB Group is the only multilateral organization with an arm exclusively dedicated to early stage innovation at the regional level. This differentiates and gives the IDB Group a comparative advantage in the field of development.

 

Data

  • Ever since it was created in 1993, IDB Lab has financed nearly 3,000 operations in 26 LAC countries, deploying more than $2.2 billion in direct financing and mobilizing close to $8 billion from third parties. The current mobilization multiplier is 6x.
  • The average ticket for an IDB Lab project is between $800,000 and $1 million, and its instruments allow it to provide financing as low as $150,000.
  • IDB Lab uses a wide array of risk-tolerant instruments to support early stage innovation:
  • Reimbursable instruments: these include loan capital and mezzanine debt offered directly to companies (tickets ranging from $1 million to $5 million), as well as investments in venture capital funds or local financial intermediaries (tickets of around $10 million, or up to 20% of the fund's capitalization).
  • Non-reimbursable instruments: these help build the innovation and entrepreneurship ecosystem (tickets of around $1 million per project) and finance very early stage innovations (tickets between $150,000 and $700,000), and may include reimbursements if innovations become commercially successful.
  • To foster entrepreneurial innovation, IDB Lab supports, on the one hand, early-stage solutions (about 80% of its projects) and, on the other hand, the entrepreneurial ecosystems that they require in order to thrive (about 20% of projects).
  • To reach all eligible countries in the region, IDB Lab not only supports disruptive innovations in more mature markets, but also implements solutions in less developed markets that have already been tested in other environments and can provide incremental benefits in a new context. Nearly 60% of IDB Lab projects are located in the region's least developed countries (C & D), including 20% in small and island countries (S & I).
  • IDB Lab’s venture capital portfolio currently includes 53 active funds reaching more than 850 companies in various sectors and countries throughout the region. Seventy percent of its funds have female investment committee members.
  • IDB Lab’s direct equity portfolio has 23 active investments, 60% of which have women co-founders.
  • In the last five years alone, and cumulatively, IDB Lab projects have directly and indirectly benefited millions of poor and vulnerable people.

 

Sample of Outstanding Initiatives

  • Green Entrepreneurial Engine: umbrella initiative bringing together IDB Lab projects that address the climate crisis and environmental sustainability, accelerating climate technology innovation in LAC. This approach seeks to create value through natural capital and nature-based solutions in the region.
  • LACChain: global alliance for the development of the blockchain ecosystem and for scaling the impact of the web 3.0 for inclusive purposes in LAC.
  • fAIr LAC: alliance of public, private and academic actors that promotes the responsible use of artificial intelligence (AI). IDB Lab focuses on the entrepreneurial ecosystem by promoting tools to reduce bias in AI-based solutions developed by startups.
  • WeXchange: platform that has been supporting female entrepreneurship in STEM areas since 2012 by connecting women with mentors and investors.
  • Workertech: initiative to improve the employment benefits and productivity of self-employed workers via digital services.
  • Silver economy: set of initiatives to improve the quality of life of older adults by promoting the creation of services dedicated to this age group and to ensure that they remain productive at this stage of their lives, taking advantage of their talent and their significant growth potential for the economy in general.
  • TSUBASA: program connecting Japan's innovation ecosystem with that of LAC. It consists of open innovation calls to leverage Japanese entrepreneurial innovations to address challenges in our region.
  • Spain Latam Scale Up: program facilitating the establishment of innovative Latin American startups in Spain as a gateway to the European market.
  • Govtech (Govtech LATAM) and Corporate Impact Venturing (CIVLAC) programs to scale innovative solutions across the public and private sectors.

 

Publications: 

Silver Economy

Climate Change

Water and Sanitation

Entrepreneurial Ecosystem

Dominican Republic
Contacts

Manzano Guillen, Maria De Gador

Manzano Guillen, Maria De Gador
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