USAID: Inviting applications for ‘Development Innovation Ventures (DIV)’ to source innovative ideas, pilots and rigorously tests them, and supports the scale-up of solutions that demonstrate proven impact and cost-effectiveness.

Funding brief: Through a year-round grant competition, Development Innovation Ventures (DIV) sources innovative ideas, pilots and rigorously tests them, and supports the scale-up of solutions that demonstrate proven impact and cost-effectiveness. DIV’s tiered funding model; inspired by venture capital funds, invests comparatively small amounts of funding in a variety of unproven ideas, and provides more substantial support only to those that demonstrate rigorous evidence of impact, cost-effectiveness, and potential to scale. Taking a portfolio approach to its impact enables DIV to embrace risk – and occasional failure – as it generates an evidence base for open innovation. DIV’s aim is to create a portfolio of innovations across all sectors and geographies in which USAID works, to improve the lives of millions around the world.

DIV funds development innovations, which can include:
● New technologies.
● New ways of delivering or financing goods and services.
● More cost-effective adaptations to existing solutions.
● New ways of increasing uptake of existing proven solutions,
● Policy changes, shifts, or nudges based on insights from behavioural economics.
● Social or behavioural innovations.

Innovations are not required to be technology-based, but should be evidence-informed. DIV supports applications on all development topics and sectors operates. 1, and from organizations eligible under D.2. below, as long as their work will take place in a country in which USAID

DIV assesses proposals according to its core principles: rigorous evidence of impact, cost-effectiveness, and viable pathways to scale, as well as the capacity of the team testing or implementing the proposed intervention. DIV’s staged funding model provides investment corresponding to an innovation’s demonstrated potential according to each of these criteria. DIV recognizes that the organizations it supports will need flexibility to iterate and adapt innovations, and DIV strives to provide this flexibility through outcomes-oriented contracting.

There are several types of projects that are not a good fit for DIV’s objectives. These include (but are not limited to):
● Interventions with limited potential to scale, and/or minimal demonstration of cost-effectiveness and impact (e.g., building schools).
● Basic scientific research (e.g., laboratory research of a prototype with no field testing; pharmaceutical testing before full regulatory approvals).
● Innovations on a private sector path to scale that lack a “base-of-the-pyramid” customer focus and are unlikely to lead to significant development impacts for the poor.

● Planning or diagnostic tools that are difficult to link directly to measurable development impacts
 Innovations that is applicable only in very limited contexts.
 Research that will not provide evidence of impact, cost effectiveness, or scale potential.
 Intermediaries with an indirect impact on development outcomes (e.g., incubators, accelerators, start-up boot camps, conveners).
 Innovations who cannot adequately explain their theory of change.

DIV Core Principles:There are three fundamental objectives that drive DIV’s search for innovative and impactful development solutions:
● Evidence—DIV is designed to find, test, and scale-up the most effective innovations, and encourage rigorous testing methods (e.g., market tests, randomized controlled trials) as appropriate, given a proposal’s stage and scale path. Evidence can encompass ultimate impacts (e.g., infant mortality), or improvements in implementation outcomes (e.g., adoption) for solutions that have been causally linked to ultimate impacts in the past. Measurement of impact should focus either on outcome variables that can be taken as objectives in themselves (e.g., lives saved or additional income), or on intermediate outcomes for which strong evidence already exists of impact on ultimate outcomes (e.g., vaccination rates).
● Cost-Effectiveness—DIV seeks innovations that deliver more development impacts per dollar than other ways of achieving the same development goals, such as increased literacy per dollar in comparison to existing practices to improve literacy. Cost-effectiveness does not necessarily mean an innovation must be the lowest-cost innovation. Rather, cost-effectiveness is a function of both impact and cost. An innovation can be highly cost-effective either by achieving a larger impact on specific outcomes at a cost comparable to alternatives, or by achieving comparable impact on specific outcomes at a significantly lower cost than alternatives.
● Pathways to Scale—DIV’s ultimate goal is to support development solutions to scale sustainably in order to reach millions of people. Solutions must have a potential pathway to scale, whether a) commercially; b) through incorporation into the practices of developing country governments, donors, or philanthropists; or c) through a combination of commercial and public or philanthropic support. DIV recognizes that innovations can take a variety of pathways to scale, but expects that they will ultimately grow without continued DIV support.

The more funding requested, up to 5 million dollars, the more confidence DIV will need to have in the innovation’s evidence base, cost-effectiveness, and potential to scale, as well as the capacity of the team testing or supporting the intervention. This includes gathering appropriate evidence of impact and/or commercial viability at each stage and for each type of pathway to scale. Specific requirements regarding evidence, cost-effectiveness, and scaling expectations are described below, and may differ based on funding stage, type of innovation, and pre-existing evidence base and lessons learned.

● STAGE 1: Proof of Concept / Initial Testing (up to $200,000) Stage 1 is used to test the proof of concept of any innovative service, product, or business model in a developing country context. A Stage 1 innovation is at initial stages of implementation and needs to be tested within a market to understand interest from consumers, impact, and feasibility. While a strong theory of change is critical, the impact of the innovation may be less obvious on “direct beneficiaries” in the short-term (for example, innovations that reduce pollution, improve governance, etc.). Innovations must be post-prototype or ideation phase, but pre-revenue innovations are considered at this stage.

● STAGE 2: Testing and Positioning for Scale ($200,000 to $1,500,000) Stage 2 is used to test the business or delivery model of a product or service. Building on the parameters of Stage 1, smaller Stage 2 awards (up to $500,000) are generating evidence of user demand beyond the proof of concept. For commercial models, Stage 2 awards support the generation of a sustainable business model and, therefore, innovations should be post-revenue. Innovations should be collecting data on usage as well as proxies for eventual social impact, however, clear and rigorous evidence of impact is not needed in the lower range of funding levels for this stage. Larger scale Stage 2 innovations (over $500,000) must include or test the evidence of impact of an innovation. This evidence of impact must be causal and rigorous – the grantee must either have rigorous underlying evidence already established, use this funding to run an evaluation with an evaluation partner, or run an evaluation with its own funding during the grant period. There must be demonstrated significant demand for the innovation.

● STAGE 3: Scaling ($1,500,000 to $5,000,000) Stage 3 provides funding for catalytic partnerships to scale the innovation to a new context or demonstrate replicability. Funds must leverage additional external funding or partnerships. Innovations with an expected private sector scaling pathway should have already demonstrated commercial viability in their existing location and the ability to attract commercial and/or impact capital on market terms that would allow sustained expansion, as well as a prima facie case for development impact based on causal, rigorous evidence and demonstration of cost-effectiveness. For commercial innovations, organizations should no longer need donor funding for basic operations; rather, these funds should be used to attract external funding, or for strategic partnerships to scale to new contexts. Stage 3 investments in commercial projects will only be considered on a pari passu (“equal footing”) basis with other donors/investors, and not as the lead donor. For public sector innovations, organizations should have partnerships with the government or other organizations in place to scale the innovation.

● Evidence Generation (up to $1,500,000) DIV is committed to generating evidence in the development sector. Researchers may apply for funds to evaluate the impact of cost-effective innovations in partnership with an implementer (for example, a host country government, social enterprise, nonprofit, etc.). Research is separated from the requirements of staged funding, since research projects vary in funding need and may apply to build on existing research or for any amount up to the funding cap for new research projects. We encourage evidence generation efforts alongside innovation development. DIV is also willing to fund evidence generation for a project implemented by other means. Small grants (up to $150,000) are available for researchers to participate in the application of the research results to improve development outcomes. Pilot research projects for which funds are not used to generate causal, rigorous evidence are strongly discouraged.

 As part of DIV’s support for cash benchmarking, funds will be made available to support the rigorous evaluation of standard programs in order to create comparisons to the DIV-funded household grants evaluations.

Donor Name: USAID
Funding name: FY2018 & 2019 Development Innovation Ventures Annual Program Statement (APS)

Funding Opportunity Number: 7200AA18APS00005

Deadline: 11th, September, 2019

Funding details link: Click to view

Funding limit: $25,000 – $5,000,000
● STAGE 1: Proof of Concept / Initial Testing (up to $200,000)
● STAGE 2: Testing and Positioning for Scale ($200,000 to $1,500,000)
● STAGE 3: Scaling ($1,500,000 to $5,000,000)
● Evidence Generation (up to $1,500,000)

Special Notes: Please contact with the donor directly for further clarification and understanding.

Project start date: Not found
Project duration: Not found

Eligible organization: As below

● Public, private, for-profit, and non-profit organizations, as well as institutions of higher education, public international organizations, non-governmental organizations, U.S. and non-U.S. governmental organizations, multilateral and international donor organizations are eligible under this APS. All organizations must be determined to be responsive to the APS and sufficiently responsible to perform or participate in the final award. This award is also contingent on USAID obtaining concurrence from the responsible Mission.
● All applicants must be legally recognized organizational entities under applicable law. Local organizations are eligible and encouraged to apply, as well as consortia of local organizations. Participation of foreign government organizations under this APS is possible only through an approved sub award agreement with a prime recipient.

Eligible Country: No country bar found (Open to all regions)

Submission mail: Not found

Other important link:
● Apply: Click to view

● General Information:
● Working with USAID:
● Information regarding the award solicitation and award process and Standard Provisions for U.S. organizations and Non-U.S. Non-governmental Organizations is available in ADS 300 (Chapter 303 is particularly helpful):
● Grant and Contract Process (most relevant for applicants include steps 7/8):
● Intellectual property4 and other issues: ● Environmental Compliance background information:
● Information on how the Agency will ensure environmental soundness and compliance in design and implementation when required by the 22 CFR 216 determination (ADS 204):
● Branding and Marking policy and frequently asked questions:
● USAID’s Gender Equality Policy

How to apply: Interested applicant may apply through the website (Click to view).

Visit all Funding opportunities: Click to view
Visit all funding categories:  Click to view

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