2020 ANNUAL IMPACT REPORT Fueling high-impact enterprises from seed to scale

Mercy Corps Ventures finds, funds, supports and partners with high-impact enterprises developing bold solutions to the world’s toughest challenges.

in this report

1. Welcome | 2. By the Numbers | 3. Resilience During Crisis | 4. Building Climate Resilience | 5. Accelerating Financial Resilience | 6. Recent Investments | 7. Fails & Lessons Learned


RESILIENCE. The events of 2020 and the resulting changes to how we work, live and interact with each other were understandably accompanied by a great degree of anxiety and uncertainty. It was a profound year that made many of us redefine success and question our fundamental assumptions about how to operate in the world. It’s also led some to say that resilience is the new ROI.

This concept hits home for us. After all, investing in and helping to build resilient ventures is the only way to safeguard the impact we aim to achieve. But what are the ingredients of resilience? How can you tell if a company you’ve invested in, or might invest in, is resilient? Are we, as investors, resilient ourselves? These are the types of questions that came up for us as we reflected on the last year and tried to relive what happened while we were in survival mode and, frankly, scrambling to support our portfolio and continue to move capital.

This report is peppered with what we came up with. In it we look at a few dimensions of resilience that are important to Mercy Corps Ventures, like climate resilience and financial resilience. Then we examine our own failings and lessons learned over the last year and how we can make changes in 2021 to improve our own resilience as investors. We hope you enjoy this glimpse into some amazing enterprises, emerging technologies, and much-needed shifts in systems perpetuating an inequitable status quo.

Wishing you tenacity in uncertainty,

The Mercy Corps Ventures Team

After a decade living in Afghanistan and Kenya, we have seen firsthand the incredible human potential that goes untapped — we plan to unleash this potential with Powered by People, by equipping millions of creators with the technology they need to compete, bridging the economic and digital divide, enabling strong, global, profitable businesses.

- Ella Peinovich | Founder & CEO, Powered by People

By the Numbers

Customer Spotlight: Health insurance for all.

Lack of access to health and life insurance leaves low-income populations vulnerable to financial shocks from unexpected injuries and illnesses. In Africa, 90% of the population has no safety net if they get sick, and most people only receive the health care they can pay for out of pocket. Turaco is changing that by designing simple and affordable insurance products for low-income consumers like Mercy. Mercy had health complications resulting from the birth of her daughter and had to be hospitalized for a week to receive ongoing care. She submitted her paperwork, and her claim was paid the same day. Mercy’s insurance policy allowed her to get the necessary medical treatment without worry that it would push her family into poverty, like it does almost 100 million people each year. Turaco is currently providing coverage to over 550,000 low-income people in East Africa, and it is growing fast.

Resilience During Crisis

The pandemic has been, and still is, an incredibly trying time for entrepreneurs. It has tested their adaptability, perseverance, creativity and pain tolerance. Some separated the emotional baggage of pandemic uncertainty and acted fast, made tough decisions early and then focused on execution. They made (and took) pay cuts, they renegotiated contract or payment terms, they stopped or refocused product development, and they identified adaptations in their business model that would increase resilience — to this crisis and the next one. It took courage and it took skill, and now their teams are stronger as a result.

Other companies already had their risk distributed across channels and geographies and didn’t seem to need to react as quickly. Some had just closed a funding round and had (or thought they had) the capital they needed to ride it out. Some had strong businesses but were just about to start fundraising when the investment landscape changed overnight and capital pools dried up, leaving them scrambling to raise bridge rounds. Every company, entrepreneur and situation was unique.

But, no matter their situation, across the board we saw entrepreneurs with a dedication to impact, who made personal sacrifices to respond to the community needs created by the pandemic. Here are a few of their stories.

Turaco made COVID-19 insurance a reality. Most insurance companies in Africa decided to exclude COVID-related claims, leaving people at risk. Turaco figured out how to provide COVID-19 inclusive health and life microinsurance and supplied over 5,000 policies.

Sokowatch opened its network to new players. When the pandemic struck, Sokowatch recognized that its logistics infrastructure, supply chains and network of retailers could help provide food aid and other essential goods to people struggling with the crisis. It partnered with Mercy Corps to provide vulnerable families digital vouchers, which could then be redeemed at local shops for essential goods.

Valiu launched a direct cash transfer program in Venezuela. Through Valiu.org, the company can now airdrop dollars to people in critical socioeconomic situations. Valiu successfully piloted this offering with 120 medical workers fighting COVID-19 and then dropped $100,000 to 1,000 more frontline workers.

Lynk joined the Safe Hands Kenya initiative and used its gig economy platform to recruit nearly 400 people overnight to earn an income by providing disinfection services, education and masks to some of the hardest hit informal communities in Nairobi. Additionally, as more than 80% of the working population in Kenya operates in the informal sector — with no unpaid leaves, furloughs, salary cuts or severance payouts — Lynk created a safe working environment for “Pros” and their customers by providing free education and protective wear.

Advice From Entrepreneurs

Whether it’s COVID-19, economic fallout, a government coup or some other crisis, social enterprises often find themselves working in communities where disruption is the rule rather than the exception. Learning how to build organizations that can weather the storm and stay relevant is key to staying afloat. We gathered some advice from entrepreneurs who have done just that:

Find video interviews on talent, money, addressing impact tradeoffs and much more in our co-created Scaling Through Mass Disruption series.

Photo credit: LYNK

Building Resilience to the Climate Crisis

The climate crisis is upon us. Its effects are wide-reaching and diverse and include extreme weather events, reduction in land for agricultural activities, increases in pests and diseases that affect crops, loss of livelihoods, reduced availability of water, displacement and increased migration. Millions of people are already feeling these effects, and millions more are at risk. By 2030, climate change could push 100 million people into poverty, with developing countries bearing an estimated 75-80% of its costs.

Communities around the world are already at considerable risk and searching for solutions to the challenges they’re facing. They need solutions that can strengthen their resilience to financial shocks, like microinsurance. Solutions that can enhance their livelihoods, like climate-smart agriculture technologies. Solutions that can increase the resilience of their communities, like secure property rights and sustainable supply chains.

Entrepreneurs are creating the tailored, scalable solutions needed to meet the demands of climate-vulnerable, last-mile consumers, empowering them with the tools they need to adapt, overcome shocks and diversify their livelihoods. We’ve invested in some of these market-based solutions and will expand our investments in climate adaptation solutions in the years to come.

Smallholder farmers are particularly vulnerable to the effects of climate change, like erratic rainfall and extreme weather events. Pula insures farmers against weather-related risks by bundling its insurance into farmers’ purchases of inputs such as seeds and fertilizers — making its insurance affordable, accessible and customized to the needs of farmers. This doesn’t just protect farmers against the negative impacts of climate change — it can also incentivize them to purchase climate-resilient seeds and other inputs that will help them adapt to a changing climate.

Providing information about how to adapt to climate change (for instance, introducing climate-resilient agricultural techniques) is another essential approach. Arifu’s mobile phone-based educational platform is reaching smallholder farmers and other vulnerable populations with advice and information on climate-resilient practices. After all, knowledge is power — in this case, the power to adapt to the impacts of climate change.

Gaining legal title to one’s land — especially for smallholder farmers — unlocks financial services and government resources that incentivize resilience-building investments (e.g., crop rotation, tree planting, etc.) and enable adaptation. Meridia and Suyo are tackling the problem of landlessness across multiple markets in Latin America, Africa and Southeast Asia. Coupled with smart partnerships and on-the-ground community engagement, their innovative technology solutions significantly lower the costs to map and title a property and create profound, immediate impact that can last a lifetime and be passed on to future generations.

Photo credit: Suyo

Accelerating Financial Resilience

The existing financial and banking systems are antiquated, broken and exclusionary. Put simply, they aren’t designed to serve the needs of the world’s most vulnerable — leaving 1.7B people completely “unbanked” and hundreds of millions more “underbanked.”

Small farmers in remote areas, people living in informal settlements, refugees fleeing conflict zones, migrants seeking work, informal workers and microentrepreneurs don’t fit neatly into the existing financial system box. They may not have access to a traditional ID, credit history or verifiable income. They are part of the 66% of people living in Sub-Saharan Africa who work in the informal sector. They live in rural areas, favelas, shantytowns and slums and may have limited internet connectivity. Many are on the move, whether pursuing shifting livelihoods, fleeing violence or displaced by climate change. To add to the problem, the majority of the unbanked are women, which leaves them excluded from local, national and global economies and hampers their ability to achieve any level of financial independence.

To accelerate financial resilience, we must design financial products and services to meet the unique needs of these populations. This year we supported a portfolio of enterprises at the forefront of this endeavor and launched a new initiative to deepen our efforts to serve the unbanked and underbanked.

Introducing FinX

We’re living in a unique moment in history when emerging technologies have the potential to radically transform the existing financial system and create revolutionary new pathways for people to spend, save, send and secure money.

While these emerging fintech, crypto and blockchain technologies present great potential, they also pose substantial risks for the world’s most vulnerable people if their needs are not taken into consideration during design and deployment.

FinX is designed to leverage Mercy Corps’ 40+ years of experience in frontier markets and financial inclusion to reimagine the financial system with the world’s most vulnerable at the center of its design. To do this we are making equity investments in emerging fintech companies, piloting new products and services tailored to vulnerable populations and humanitarian use cases, rigorously measuring impact to build the evidence base, and sharing learnings and failures along the way. But many threats confront us in this endeavour.

Our first FinX investment was in Valiu. This company is an amazing example of how emerging fintech solutions that leverage crypto DNA can bring about positive impact for vulnerable populations — in this case, for Venezeulan migrants, refugees, and those who remain in the country watching their savings slip away as a result of rampant inflation and currency volatility.

Curious how Valiu works and its link to the SDGs? Check out this video:

The first FinX pilot was kicked off at the time this report was published. In it we experiment with using stablecoins to make cost-effective, crossborder micropayments to low-income youth conducting digital microwork from their phones. The outcome remains to be seen. Will the payment rails work? Will the stablecoin-based digital wallet unlock new digital employment and earning opportunities for vulnerable populations?

Recent Investments

We back teams with the vision and tenacity to fundamentally reshape systems and expand opportunities for all to thrive. Building strong relationships with entrepreneurs, investors and ecosystem partners over the years has enabled us to generate an incredibly active pipeline of high-impact startups that align with our investment thesis. This past year we had the pleasure of screening almost 1,000 potential deals from across the globe. Of those, we invested in five companies. We hope you enjoy reading about these amazing ventures and why we decided to place bets on them.

Valiu is a digital financial institution designed from the ground up around the needs of migrants, refugees and people facing hyperinflation.

Seeing my family’s savings and life’s work quickly go to zero while growing up in Venezuela made me want to dedicate my reputation, money and time to make cryptocurrencies successful so that anyone, regardless of their socioeconomic status, can access transparent, safe, fast and minimal cost financial services, and so no one has to see their life’s savings go to waste. As a team, we’ve built Valiu because we want to enable financial prosperity for anyone, anywhere.

Simon Chamorro | Founder & CEO

Photo credit: Valiu

Turaco is an insurtech company designing simple, quality health insurance products for urban and rural poor living on less than $5 a day.

"I founded Turaco to free people from the fear of financial shocks. Insurance is such a simple tool to help people stay out of poverty. Yet almost none of the people who need it most have it. We are going to change that."

Ted Pantone | Founder & CEO

Photo credit: Turaco

Powered by People is a marketplace platform and digital tools designed to empower skilled producers in low-income countries and create connections to (and transparency for) global buyers.

After a decade of working in and gaining an understanding of the local markets in Afghanistan and Kenya, my co-founder Hedvig Alexander and I have seen firsthand the incredible human potential that goes untapped. We plan to unleash this potential with Powered by People by equipping millions of creators with the technology they need to compete, bridging the economic and digital divide, and enabling strong, global, profitable businesses.

Ella Peinovich | Founder & CEO

Photo credit: Powered by People

Boost offers digital solutions, stock deliveries and inventory financing designed for informal small and medium businesses in Africa.

I founded Boost with the mission of enabling millions of small businesses to thrive in Africa’s digital economy to create sustainable jobs and income.

Mike Quinn | Founder & CEO

Photo credit: Boost

Teliman is Mali’s very first moto-taxi ride hailing app. It provides unemployed youth with decent work and financing to own their own motorcycle.

Upon returning to Mali we were struck by the lack of road infrastructure in Bamako. Getting around was always a big hassle and something needed to be done. But that something needed to be in accordance with local culture. This is how we slowly ventured into a sustainable moto-taxi service, built around a strong leasing model that would not only solve the transportation issue but also contribute to creating jobs for unemployed youth.

Elay Maiga | Founder & CTO

Photo credit: Teliman

Fails & Lessons Learned

In episodes of NPR's "How I Built This with Guy Raz" — a podcast where successful entrepreneurs explain how they founded their businesses — the last question Raz asks each guest is, "How much of your success do you attribute to your skill, your intelligence, your hard work, and how much of it to luck?" Answers vary widely, from almost zero luck to a 50-50 split to comparing the timing of a company’s launch to winning the lottery five times in a row.

This has always been an interesting question to us. It’s an even more interesting question in the context of a global crisis like a pandemic. How much were outcomes dictated by the timing of the pandemic alongside a company’s product development and fundraising cycle? How much by the skill of the teams weathering the storm?

It’s up to each team to decide for themselves, but this crisis will not be the last, and if 2020 has taught us anything, it’s that we all need to work to stack the deck in favor of skill by increasing our resilience. This will require equal parts vision and tenacity along with the ability to build through uncertainty and the creativity and confidence to stare down a problem, and then quash it.

Adaptability. Diversity. Emotional intelligence. There’s a lot to unpack in a term like resilience. While we don’t claim to have all the answers, here are some things we’ve learned along our journey.

1. We have to support each other both strategically and emotionally.

Startups are human endeavors as much as commercial endeavors. When a crisis strikes, it hits the person as well as the business. Last year was a jarring reminder of this. As investors, our first instinct is to focus on the business — to strategize, to scenario plan, to push cost-cutting measures, and the list goes on. It can be easy for us to lose sight of how the founders we support are also trying to cope with massive changes, pressures and risks in their own lives. Even if we do consider the personal effects, we may not go deep enough or do enough to support entrepreneurs on this front. But if we want the impact we support to endure, shouldn’t we think more holistically about what goes into making resilient teams who grow resilient companies that create the sustainable impact? For us, the answer is yes. And while exactly what that looks like is still unclear, we are firmly committed to keeping this in mind as we support startups going forward.

2. We have a fiduciary responsibility for impact, equity and financial performance.

This is why impact investors exist. In the best of times, all three of these buckets are aligned and trending positively together. We love it when that happens. In a crisis like COVID-19, however, we are faced with challenging tradeoffs. Cash is king, so we were forced to find as many ways as possible to extend the runway of companies in the hopes that they remain viable and continue to create impact in the long run. This often involved painful layoffs or salary cuts — sometimes both. As investors and board members, we tried, when possible, to advocate for cuts and turnaround plans that carefully considered and appropriately balanced the impact on all stakeholders. However, this didn’t always end up being the case. Some companies made cuts at the bottom, to the most vulnerable employees, while others were slow to react and forced into even more drastic layoffs as the pandemic dragged on. Hindsight is always 20/20, but in retrospect we believe we could have been more diligent in helping portfolio companies refine their approach earlier and more equitably vis-a-vis the competing priorities.

3. It’s hard to take your own medicine.

It’s easy to advise others to pivot or adapt in the face of changing circumstances — or even tell them how to do it — but it’s not a muscle that investors have to flex that often in their own systems, processes and actions where disruption is the exception, not the rule. When the investing landscape changed overnight in reaction to COVID-19, we made the conscious decision to keep deploying capital. It was the right thing for us, but it also meant that we had to change our due diligence processes, risk assessments, decision making criteria and investment priorities to fit an even more uncertain investing environment. We had to boil it down to the most mission critical actions. While we are proud to say that we did successfully deploy capital to companies both inside and outside our portfolio, we weren’t able to process and analyze our pipeline as quickly and efficiently as we would have liked. With reduced staff and an ever-changing risk analysis, we struggled to refine our investment priorities and move companies through our process. We could have communicated better, aligned expectations on timing, and avoided unintentionally stringing companies along. In a world of accelerating innovation, disruption and volatility, we know investors must be increasingly agile to be effective. We now have a better idea of what adaptation can look like for impact investors, but still have more to learn on how to flip that switch and acclimatize faster.

4. We must always consider the many dimensions of diversity.

During the COVID-19 crisis, the companies in our portfolio that had a single point of view coming from its board, from its advisors and on its cap table didn’t perform as well as those with more diverse viewpoints. VCs and impact investors look at things differently, and companies with both on their cap table benefited from the varied perspectives and resources that came from each. Diversity of genders and ages represented also made a difference as well as geographic representation and previous experience (in some cases, companies had entrepreneurs and operators on the board). The varied perspectives provoked challenging conversations and ultimately led to better decisions. In early-stage companies, it’s often difficult to achieve this level of diversity — for many, very valid reasons — and entrepreneurs end up with VC style boards where investors hold all the seats. As an investor, we are now asking ourselves if we are the right ones to take a seat on the board or if the company would be better served by us working with them to appoint someone else to an independent chair role. We’ve done this with two companies and have incorporated this analysis into our investment memo structure.

This is another area where we must learn to take our own medicine. Our board and investment committees are comprised of highly qualified people who have offered us invaluable advice over the past few years. As we scale our investment activities, we too must strive to ensure we have multiple dimensions of diversity to strengthen our efforts. We commit to making changes on this front in the coming year.

5. Impact management (done right) is foundational to business resilience.

Over the last couple of years, we’ve created, honed and implemented our impact management support offering. We hypothesized that we could create an offering that would increase efficiency, business resilience and investment attractiveness. Knowing that each company we invest in will look at impact differently and be in a different stage of development, we designed this offering to be “light touch” at first, with several areas that we can go deeper on at a later time (e.g., customer feedback loops, pitch decks, etc.). So far, we’ve conducted impact management support with five companies in our portfolio. These companies have said that this offering: 1) improved their internal communications by helping all staff understand the mission, how activities align to KPIs, and why each is important for creating the desired impact, 2) showed them a new product concept wasn’t ready for an expensive tech build-out and that they needed to better understand their customer needs, and 3) re-attracted impact investors at the next financing round who had previously passed because the company couldn’t articulate how they had validated their impact. These are some promising proof points, and we’re using this feedback to continue to expand this offering on our quest to safeguard impact and create more resilient ventures.

This year we also explored the question of how data can power scale. This work surfaced the importance of data efforts to drive toward equity and inclusion. An equitable and inclusive data approach gives companies the ability to deliver more value to their clients and makes their business models stronger and more sustainable in return (e.g., greater customer retention, increased LTV, etc.). By effectively giving voice to the diverse stakeholders who are experts in their own lives, better solutions surface and, through data, companies can empower and uplift the communities they seek to serve. Many organizations, although faithfully driving their missions, may not have interrogated their data to ensure equity and inclusion. But they can ask themselves three key questions to start the process, illuminate possible bias and identify opportunities for improvements: 1) who determines what gets measured?; 2) how is it measured?; and 3) who gets to analyze and interpret the data? More details on our Scaling Pathways blog.

6. Our “do no harm” approach to pipeline building and diligence does pay off for some companies — but it can take a while.

In the big picture, we fund very few companies and, like most investors, we measure our success partly by how efficiently we can get cash out the door. This KPI naturally sets up an incentive to look at and pass on deals quickly, but also goes directly against our entrepreneur-first, “do no harm” ethos. For each successful deal we make, we look at approximately 300 companies. So what happens with the other 299? We strive to add value in some other way for as many as we can. For about 50 of those we provide substantial feedback we hope the entrepreneur will take to make their company more investable. For 30 or so we make connections to investors that are a better match and more likely to invest. For a handful, we make connections to Mercy Corps programs that could benefit from their services. And, once in a while, we do some matchmaking that results in an acquisition of one company in our pipeline by another — saving the one company and strengthening the other. Not to pat ourselves on the back, but it's great when you get proof that your approach is working and worth the extra time.


Five years ago, Mercy Corps Ventures was just a concept. Today it is one of the most active seed stage investors in the market and has built out a venture support and partnership capability that has helped companies raise over $90M in follow-on capital. This track record was possible thanks to the support of the Mercy Corps’ board and leadership, countless others within the agency, and a group of individuals who were brave and bold enough to seed our early fund. We are truly grateful for your support and the doors it’s allowed us to open.

Over the years, we’ve also been fortunate to be able to recruit interns that bring serious value to the table. This past year, it was our interns who saved the day. They were focused. They were motivated. They were extraordinarily productive. They became true team members and we really could not have moved capital without them. We cannot thank them enough for their dedication during this crisis. Whether they were technically classified as an intern or not, we want to give a deep and supreme thank you to Wendy Foo, Frederick Toohey, Lizzie Merrill and Nautika Simon. You all rock!

Additionally, moving capital this past year would not have been possible without our legal advisor, Joe Meginnes, as well as the generous pro bono support provided by Morrison Foerster. Donna Rocco provided exceptional financial and accounting support. We can’t thank you enough for your time and dedication to our mission.

Institutional Donors

FinX was seeded with generous support from Ripple and Rippleworks. We look forward to working with these two amazing partners to drive the future of inclusive fintech.

This year Mercy Corps Ventures joined a group of partners to manage the Agence Française de Développement (AFD) Group’s Digital Africa Venture Capital Fund. Digital Africa aims to equip Africa’s tech entrepreneurs with the capabilities needed to design and scale-up groundbreaking innovations for the real economy. We’re proud to be a core partner in this initiative and make investments of up to $300,000 to catalyze digital startups — especially those operating in West Africa and run by local founders.

Mercy Corps has joined the Celo Alliance For Prosperity because we too believe that we can build a financial system that creates the conditions for prosperity for everyone. Celo contributed funds for a FinX pilot and we’re excited for many more collaborations to come.

Ecosystem Partners

Partnerships are key to our success and we thank all our partners for collaborating with us, for teaching us, for strengthening our work, and for making our jobs not only meaningful, but also fun.

Thank you for your time and attention. We hope you enjoyed our reflections on what will surely be an unforgettable year.

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If fintech is your thing, the FinX blog is especially for you.

Unless noted, all photos © Mercy Corps.