Introducing Development Innovation Ventures

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Let's start with the problem: America is facing a time of fiscal austerity. Meanwhile, around the globe, development challenges of devastating scale continue to drive a strong moral and strategic imperative for the United States to stay a leader in international development.  Given budget constraints, we need to work harder than ever to find solutions that get the biggest bang for our development bucks. 

In July 2010, USAID launched Development Innovation Ventures.  Through DIV, USAID awards grants to compelling new development solutions, rigorously tests them, and helps scale those that are proven successful to become development grand slams.

Here's how it works:

First, we run a competition for ideas.  We recognize that development breakthroughs can come from anywhere—a lab in a university, a local person who has deep contextual knowledge, or a passionate entrepreneur. Perhaps it will come from you.

We seek solutions that are several times more cost effective than current practice. These ideas do not have to be technological solutions, but also new business models, new processes, or even novel combinations of tried and true techniques. We look for the solutions potential to scale big, to tens of millions of beneficiaries within ten years. 

Next, we test if the idea delivers the targeted development outcomes, and at a dramatically lower cost than current best practice. We use rigorous and cutting-edge methods for evaluating project impact. Many of our current grants include randomized trials of development interventions, comparing treatment groups to control groups to analyze development impact. As part of our model, we give out our awards incrementally—if your idea works, and only if it works, you can compete for additional stages of funding.

We fund ideas that are in different phases of rollout, and depending on their current phase applicants can propose a project in any of the three stages below.  To move from one stage from the next, applicants must re-compete.

STAGE ONE is for projects in the proof of concept phase: DIV will grant these projects up to $100,000 dollars over one year so that grantees can refine prototypes and gather the evidence they need to pull in more investment and grow. 

STAGE TWO is for larger projects, typically to expand across a country. DIV will grant Stage Two projects up to $1 million.  In exchange, Stage Two projects will build in rigorous testing to prove if the project is viable at its larger size.

STAGE THREE is for much larger projects.  For grants of up to $15 million over several years, solutions that have already proven to work at a large scale will be expanded much further, and often into multiple countries. By the end of Stage Three, successful projects will have rigorous evidence of multinational impact.  At this point DIV will exit, and we expect that the projects will commercialize or be replicated by various developing country governments or donor institutions. And so, within ten years, the best solutions will be mainstreamed and reach tens of millions of beneficiaries around the globe.  

Last updated: February 15, 2013

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