Public and philanthropic investors can only address a small part of the Sustainable Development Goals (SDGs) and Paris Agenda through their own investments. If we are to meet these goals, a key role for impact investors is therefore to mobilise additional capital from private investors.
Blended finance brings together public, philanthropic, and private capital into a single investment structure, with each playing a distinct role and bearing different levels of risk and return. When well-designed, these structures enable private investors to access opportunities that would otherwise fall outside of their risk-return thresholds—unlocking new markets, diversifying portfolios, and generating measurable impact. For public and philanthropic investors, blended finance is a force multiplier: it allows scarce concessional resources to catalyse significantly greater volumes of commercial capital.
Yet, despite its promise, blended finance remains underutilised. Concessional capital is limited, and in today’s environment, increasingly difficult to secure. Many blended structures are also complex, bespoke, and costly to execute. These constraints are well-known; what’s needed now are practical solutions to overcome them.
That is why BII and BCG have come together to provide practical tools to strengthen the design, assessment, and mobilisation of blended finance funds – a product for which we have seen increased appetite from private, public and philanthropic investors. These tools are grounded in BII’s direct experience investing in blended vehicles and BCG’s work advising a wide spectrum of capital providers and organisations seeking to raise funding. They also reflect the valued insights and experience of many of our trusted partners and peers. We hope these tools can support bringing more blended finance funds to market and advancing progress towards our shared global goals.
