AIA’s decision to invest $200 million into funds run by LeapFrog Investments is evidence of a growing demand from Asian LPs for impact investment opportunities, according to LeapFrog founder Andrew Kuper.
The allocation marks AIA’s first foray into impact investing, and is the latest evidence of a wider trend that has seen allocators from the region turn towards impact. Temasek, Singapore’s state-backed investor, invested and committed $500 million to LeapFrog in 2021 in a landmark deal to take a stake in the firm and anchor future funds.
Although Asian LPs have not engaged with impact investing as readily as other regions, Kuper said, the continent has seen plenty of purposeful investment through structures such as microfinance in recent decades. “It’s just really now that the LP market is catching up with that.” he added.
“Part of the reason that these big Asian players are backing us is they really understand our region. They see that there are more than half of the world’s people are in the Asian region… it’s much more proximate to them,” Kuper said. “They’re seeing a lot of opportunities come at them. So it’s not a strange idea to them that we can achieve profit with purpose focused on Asian markets.”
Kuper declined to comment on how AIA’s $200 million commitment broke down between funds, but said that the Leapfrog’s relationship with the insurer will focus on “financial services companies, healthcare companies and potentially climate companies as well, where we have a shared interest in backing businesses that focus on emerging consumers”.