The UNICEF Innovation Fund has made its first investment in Africa by acquiring an undisclosed stake in 9Needs, a blockchain startup in South Africa.

The firm developed a self-sovereign identity and contracting system that will digitally enable South African early childhood development programmes.

Using blockchain infrastructure and smart contracts, the system will help strengthen the current registration, contracting, information and management systems.

In addition to 9Needs, the first portfolio of investments includes the following four start-ups: Saycel (Nicaragua), mPower (Bangladesh), Innovations for Poverty Alleviation Lab (Pakistan) and Chatterbox (Cambodia).

In addition to announcing first investments, UNICEF has opened the next round of applications from technology start-ups.

The Fund plans to invest in 20-40 additional companies in 2017.

The vehicle provides seed investments in the startups of up to $100k.

The UNICEF Innovation Fund has raised $10.6m so far and offers innovators in developing countries a pooled funding mechanism to help them take their tested projects to the next stage.

Sunita Grote, Innovation Fund Manager at UNICEF (pictured), said: “We hope to raise $10m-$20m for the second round of the Fund.”

“UNICEF welcomes investments from governments, the private sector (individuals and organizations), foundations, academic fs, civil society, international financing institutions and multilateral organizations,” she told Africa Global Funds.

Grote said that some investors in the fund include the Government of Denmark, Government of Finland and The Walt Disney Company.

According to Cynthia McCaffrey, Director of the UNICEF Office of Innovation, the UNICEF Innovation Fund brings together models of financing and methodologies used by venture capital funds and the principles of UNICEF'S Innovation Unit.

“Using UNICEF’s 190 offices and 12,000 staff, the Fund will help us source and support companies that might be overlooked by traditional investment vehicles,” McCaffrey said.

Grote added that Traditional Venture Capital firms sometimes shy away from emerging market startups as they are seen as risky.

“UNICEF is able to capitalize on its presence on the ground in these markets and its strong relationships with the private sector, governments and academic institutions to provide a different approach for seed funding in startups and with an emphasis on creating tools that are Open Source,” she said.

The UNICEF Innovation Fund is inviting technology start-ups to apply for investment and become part of this growing portfolio of open source solutions. 

Projects funded need to increase the ability of children to access information and to increase opportunity and choice.  

Specifically, projects should align with one of UNICEF Innovation’s three portfolio areas: products for youth under 25; real-time information for decision-making; and infrastructure to increase access to services and information.

These three areas are ripe for investment due to rapidly changing technologies such as blockchain, 3D printing, wearables and sensors, artificial intelligence and renewable energy.

“We encourage applicants from all emerging markets to apply,” said Grote.

The deadline to apply is January 1, 2017.