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Lessons from a long road - launching the Utkrisht Impact Bond.

Updated: Jun 1, 2018

Peter Vanderwal.

The Utkrisht team in Jaipur - 23 April 2018 - USAID, Merck for Mothers, UBS Optimus Foundation, Strat!gos, Palladium, Population Services International, the Hindustan Latex Family Planning Promotion Trust and Mathematica at the Indian Institute of Health and Medical Research

April marked a pretty huge milestone in my professional life: the the start of the 36-month period of the implementation of the Utkrisht Impact Bond - the Rajasthan Maternal and Newborn Health Pay-for-Success financing instrument that had been a near all-consuming focus of my work for the past two years.

In one shape or form I’ve been involved in the design and implementation of innovative financing structures for about half my 20 year career in international development, but just over four years ago I got the opportunity to focus on the area and develop it as my substantive domain expertise. I got a tap on the shoulder from Palladium’s CEO, who asked me what I knew about development impact bonds.

To be honest, I knew precious little about them at that point, as the seminal Investing In Social Outcomes – Development Impact Bonds report published by the Center

for Global Development and Social Finance had only come out about three months prior – but I must have known enough to say something sensible, because not long after that conversation I was told I’d been selected from a three-person shortlist to lead the company’s work in innovative impact financing!

The first thing I did was convene a high-level working group from across all technical and geographic areas of the company to socialise this novel concept of bringing impact investment, results-based financing, and public private partnerships together in an entirely new way. The second thing was to undertake a review of the roughly 200 large-scale contracts that Palladium was either currently implementing or had recently concluded, with a view to short-listing a handful that bore all the hallmarks of being able to be adapted to a pay-for-success financing mechanism.

I could talk for days about whether this was the right way of kicking this work off, but we were committed to building the nascent DIB marketplace, and by mid-July 2014, we’d identified 13 potential interventions from around the globe, ranging from education to food security to road safety, to... maternal and newborn health! - so it's now approaching four years that I’ve been leading a team developing what eventually evolved into the Utkrisht Impact Bond.

It took a year and a half to get all the actors aligned and in the same room, another six months and a significant mapping and quality assessment exercise to agree on the outcome metrics and unit costs, four months to finalise the intervention design, nine months to get all parties contracted, three months to formally raise the funds, and two months to mobilise the teams.

Over the coming weeks I’ll focus in on each of these areas and chart out the challenges and triumphs, and the lessons to be taken away, from my experience being the chief architect (amongst many architects, builders, financiers and a host of others!) of the Utkrisht Impact Bond.

Image courtesy of the DFID-funded Project Ujjwal, implemented by Palladium
USAID Administrator Green launched the Utkrisht Impact Bond along with the Prime Minister of India Narendra Modi and Senior Advisor to the President of the United States of America, Ivanka Trump on November 29 2017 at the Global Entrepreneurship Summit in Hyderabad.

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