Choose language

Why this target for the LuxAid Challenge Fund?

This call for projects targets the “missing middle” or “pioneer gap”. These are innovative start-ups with a validated MVP (minimum viable product) and first commercial revenues, whose financing needs are too large for microfinance institutions, but too small and risky for other types of private investors. In some markets, the investment ecosystem (venture capital market) is simply not mature enough, leaving a gap in the entrepreneurial landscape and hindering the development and growth of high-impact businesses, thus creating a vicious circle.

The LuxAid Challenge Fund’s involvement in this specific segment reflects the central role of development cooperation in providing strong additionality: without this support, the project would not have been able to achieve these results, or not on this scale, or not as quickly.

Companies are unlikely to be profitable for 2-3 years, but they must have a clear business and financial plan to achieve viability. In addition, they must have, or be prepared to have, a clear theory of change and monitoring framework for their solution, and strive to improve their responsible business conduct.

Visit FAQ