The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) Innovative Startups Fund Project (P161905) MIDDLE EAST AND NORTH AFRICA | Jordan | IBRD/IDA | Investment Project Financing (IPF) | FY 2017 | Seq No: 13 | Archived on 11-Oct-2024 | ISR01096 Implementing Agencies: Innovative Startups and SMEs Fund, Jordan Loan Guarantee Corporation 1. OBJECTIVE 1.1 Development Objective Original Development Objective (Approved as part of Approval package on 22-Jun-2017) The project’s development objective is to increase private early stage equity finance for innovative small and medium enterprises ("SMEs"). Has the Development Objective been changed since Board Approval of the Project Objective? No 2. COMPONENTS Name Equity/Quasi Equity Financing Program:(Cost 44,750,000.00) Deal-Flow Creation Support:(Cost 3,130,000.00) Project Management, Coordination, and Monitoring and Evaluation:(Cost 2,000,000.00) 3. OVERALL RATINGS Name Previous Current Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Satisfactory Satisfactory Overall Risk Rating Moderate Moderate 4. KEY ISSUES & STATUS Oct 11, 2024 Page 1 of 9 The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) 4.1 Implementation Status and Key Decisions The project has supported the establishment of the Innovative Startups and SMEs Fund (ISSF), a US$98 million Fund of Funds of which US$50 million is co-financed through an IBRD Loan. It was approved by the World Bank's Board of Executive Directors on June 23, 2017. The ISSF was launched in Jordan on September 23, 2018. The project was restructured May 5, 2020 to mitigate the impact of the COVID-19 outbreak on the Jordanian entrepreneurial and startup ecosystem; and the closing date has recently been extended by one-year to June 2025. The project has showcased strong results in improving access for early-stage funding for Jordanian startups by mobilizing equity capital for pre-seed, seed, and venture capital. More than 82% of the ISSF’s total investable capital has been allocated to date, and the ISSF’s deployed investments have attracted over US$ 200 million in private capital in multiple funding raises, leveraging 19 institutional investors, and financing 138 companies (of which 31 were women-led businesses and 60 youth-led businesses). This has resulted in the creation of over 1,760 jobs in Jordan. ISSF has also played a pivotal role in supporting startups through investment readiness and business development services, stimulating the pipeline of investible startups through incubation and acceleration services. The project remains strategically relevant, and beneficial to support the growth of Jordan's entrepreneurship ecosystem. To date, the project has disbursed 82% out of total $50 million that is financed by the World Bank. Despite a slowdown in the global venture capital industry, ISSF has managed to further increase its deployed capital and signed investment deals. Affected by pressure stemming from the global and regional macro environment (delay in interest rate cuts in the US, rise in oil prices, geopolitical risks in the region, etc.), global VC industry has been on a decline in 2022-2023, both in terms of the number of new deals as well as new funding, with a 60 percent decline in funding in 2023 compared to 2021. Against this sluggish global backdrop, the ISSF's consistent progress in deploying its investable capital is commendable. These results have been possible thanks to the strength of the management team, the participation of recognized private sector representatives in the Board, a continuous monitoring of the regional trends and opportunities, and a robust M&E system that tracks the outcomes on regular basis. More information can be found online at: https://issfjo.com/home/ 5. SYSTEMATIC OPERATIONS RISK-RATING TOOL Rating at Approval Last Approved Rating Risk Category Approval Package - ISR Seq. 012 - 05 Jan Proposed Rating 23 Jun 2017 2024 Political and Governance Moderate Moderate Moderate Macroeconomic Substantial Moderate Moderate Sector Strategies and Policies Substantial Moderate Moderate Technical Design of Project or Program Substantial Moderate Moderate Oct 11, 2024 Page 2 of 9 The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) Institutional Capacity for Implementation and Substantial Moderate Moderate Sustainability Fiduciary High Moderate Moderate Environment and Social Moderate Low Low Stakeholders Low Low Low Overall Substantial Moderate Moderate Oct 11, 2024 Page 3 of 9 The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) 6. RESULTS 6.1 PDO Indicators by PDO Outcomes Private Capital Mobilized Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Private Capital Mobilized 0.00 Jun/2017 84,555,000 30-Jun-2024 84,555,000 30-Jun-2024 71,500,000.00 Jun/2024 (Amount(USD)) Private Early/Seed Stage 0.00 Jun/2017 44,055,000 30-Jun-2024 44,055,000 30-Jun-2024 14,500,000.00 Jun/2024 Capital Mobilized Comments on Private capital from co-investment in deals Through the Project achieving targets (Amount(USD)) Private Venture Capital 0.00 Jun/2017 40,500,000 30-Jun-2024 40,500,000 30-Jun-2024 57,000,000.00 Jun/2024 Mobilized Through the Comments on Private Capital share of investment in VC funds plus co-investment with other private capital in Project achieving targets deals (Amount(USD)) Beneficiary Companies Receiving Financing Through the Project Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year 0.00 Jun/2017 138 30-Jun-2024 138 30-Jun-2024 150.00 Jun/2024 Beneficiary Companies Comments on This PDO indicator measures the total number of innovative start-ups and SMEs that receive Receiving Financing Through achieving targets financing through the project (companies that receive follow-on financing through the project the Project (Number) should only be counted once) Beneficiary Companies 0.00 Jun/2017 125 30-Jun-2024 125 30-Jun-2024 80.00 Jun/2024 Page 4 of 10 The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) Receiving Private Comments on This indicator captures all companies that receive financing through the project in an amount Early/Seed Stage achieving targets less than US$750,000 Financing Through the Project (Number) Beneficiary Companies 0.00 Jun/2017 13 30-Jun-2024 13 30-Jun-2024 70.00 Jun/2024 Receiving Private VC Financing Through the Project (Number) Beneficiary Companies 0.00 31.00 31.00 38.00 Led by Women Receiving Financing Through the Project (Number) Beneficiary Companies 0.00 60 60 45.00 Led by Youth Receiving Comments on Youth is defined as a person between 21-34 years old Financing Through the achieving targets Project (Number) Beneficiary Companies That Introduced a New Product or Process Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Beneficiary Companies That 0.00 Jun/2017 100.00 30-Jun-2024 100.00 30-Jun-2024 100.00 Jun/2024 Introduced a New Product or Comments on This PDO indicator will track innovation emanating from recipients of Grants and equity Process (Percentage) achieving targets investment through the project. 6.2 Intermediate Results Indicators by Components Page 5 of 10 The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) Equity/Quasi Equity Financing Program Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year 0.00 Jun/2017 19 30-Jun-2024 19 30-Jun-2024 10.00 Jun/2024 Total Financial Intermediaries Comments on This indicator measures the total number of financial intermediaries that receive financing Receiving Financing Through achieving targets through the project (funds that receive follow-on financing through the project should only be the Project (Number) counted once) Venture Capital 0.00 Jun/2017 8.00 30-Jun-2024 8.00 30-Jun-2024 6.00 Jun/2024 Financial Intermediaries Comments on This indicator captures number of Funds that receive financing through the project in an Receiving Financing achieving targets amount above US$750,000 Through the Project (Number) Early/Seed Stage 0.00 Jun/2017 11 30-Jun-2024 11 30-Jun-2024 4.00 Jun/2024 Financial Intermediaries Comments on This indicator captures all Financial Intermediaries that receive financing through the project in Receiving Financing achieving targets an amount less than US$750,000 Through the Project (Number) Deal-Flow Creation Support Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Beneficiary Companies 0.00 Jun/2017 712 30-Jun-2024 712 30-Jun-2024 675.00 Jun/2024 Receiving IR Support and BDS Comments on Measures the number of beneficiaries that receive investment readiness training and Business Services Through the Project achieving targets Development Services (BDS) grants as means of support to become ready/eligible for (Number) investment through the ISSF Beneficiary Companies 0.00 38.00 38.00 30.00 Led by Women Receiving IR Support and BDS Services Through the Project Page 6 of 10 The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) (Percentage) Beneficiary Companies 0.00 42.00 42.00 30.00 Led by Youth Receiving IR Support and BDS Services Through the Project (Percentage) Beneficiary Companies 0.00 Jun/2017 632.00 30-Jun-2024 632.00 30-Jun-2024 600.00 Jun/2024 Receiving IR Support Through the Project (Number) Beneficiary Companies 0.00 Jun/2017 80 30-Jun-2024 80 30-Jun-2024 75.00 Jun/2024 Receiving BDS Services Through the Project (Number) Prospective Angel Investors 0.00 Jun/2017 32.00 30-Jun-2024 32.00 30-Jun-2024 30.00 Jun/2024 Receiving Training Through Comments on Entities receiving grants and Prospective Angel investors receiving training the Project (Number) achieving targets Beneficiaries Receiving 0.00 Jun/2017 304 30-Jun-2024 304 30-Jun-2024 150.00 Jun/2024 Acceleration Services Through Comments on Number of startups/ SMEs receiving acceleration services for 4-6 months the Project (Number) achieving targets Female Beneficiaries 0.00 62 62 30.00 Receiving Acceleration Services Through the Project (Percentage) Young Beneficiaries 0.00 79 79 40.00 Receiving Acceleration Services Through the Project (Percentage) Project Management, Coordination, and Monitoring and Evaluation Page 7 of 10 The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year 0.00 Jun/2017 93.00 21-Dec-2023 93.00 21-Dec-2023 75.00 Jun/2024 Comments on The beneficiary satisfaction survey covered four main areas: (i) communication channels; (ii) achieving targets efficiency of the selection process; (iii) efficiency of the funding release; and (iv) quality of the coaching program. The 93% satisfaction rate reflects the positive comments/marks across all Beneficiaries Satisfied With four areas (118 responses in total, out of which 110 includes marks "Good" and above or only Services Received and positive qualitative comments). The respective satisfaction rate for each are is the following, Performance of Funds respectively: (i) 89%; (ii) 100%; (iii) 90%; and (iv) 100%. (Percentage) Page 8 of 10 The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) 7. DATA ON FINANCIAL PERFORMANCE 7.1 Cumulative Disbursements 7.2 Disbursements (by loan) Loan/Credit/TF Status Original Revised Cancelled Disbursed Undisbursed % Disbursed Historical Disbursed IBRD-87670 Effective 50.00 50.00 0.00 46.83 3.17 93.65% 50.00 7.3 Key Dates (by loan) Loan/Credit/TF Status Approval Signing Effectiveness Orig. Closing Rev. Closing IBRD-87670 Effective 23-Jun-2017 21-Aug-2017 19-Dec-2017 30-Nov-2023 30-Jun-2025 8. KEY DATES Oct 11, 2024 Page 8 of 9 The World Bank Implementation Status & Results Report Innovative Startups Fund Project (P161905) Key Events Planned Actual Approval 23-Jun-2017 23-Jun-2017 Effectiveness 19-Dec-2017 19-Dec-2017 Mid-Term Review No. 01 23-Dec-2021 23-Dec-2021 Operation Closing/Cancellation 30-Jun-2025 9. RESTRUCTURING HISTORY Restructuring Level 2 Approved on 01-May-2020 Restructuring Level 2 Approved on 04-Jun-2024 10. ASSOCIATED OPERATION(S) There are no associated operations Oct 11, 2024 Page 9 of 9