I'll try to make it short because it's a long story.
CDC started in 1948, had a lot of impact and achieved a great reputation for being pioneering, particularly in Africa. If you go around Africa today, you see plantations, financial institutions, and cement factories that simply wouldn't exist without CDC. Roll the clock forward, though, and by the end of the 1990s, it had become a pretty big and not very commercial organization. It was making very long investments, plantations and things like that.
Tony Blair and his team looked at it and said that surely they could improve the commerciality of the organization and suggested they PPP it. They wanted to bring in commercial capital alongside government capital. Their timing was terrible. It was just after the Asia crisis, and all commercial capital looked at CDC and said that the balance sheet was far too scary for them and were put off by the idea of investing alongside government.
Because they brought in a very commercial team to run that process, that team wasn't happy with the status quo and came up with plan B, which was to split CDC into two. They basically split us along private equity norms. They created a new investment organization called Actis, which took virtually all of the people and did all the direct investments from then on. What was left was a very small lump of people with their mandate staying within public ownership of providing capital to funds, including Actis. Aureos had also started within CDC. During the period 2004 to 2011, all that CDC did was seed the private equity market across emerging markets.
Lots of good was done, even though over time that model became unpopular, because it was felt by politicians in time that wasn't developmental enough, because you're giving your capital to third parties who were making the investment decision on your behalf. Therefore, it's unlikely, given that those fund managers were also raising capital from third party commercial funds, they're going to be doing the hardest things.
In 2011, I was brought in and asked to continue the funds business—because it's a great business, and it's very developmental—but to start investing directly again from scratch when CDC had lost its direct connection with the market. That was the big part of the mandate.
The other thing I was asked to do was to shrink the geographies—no more China, no more Latin America, no more Southeast Asia—and to really focus it on the poorest parts of the world. There was a big change in mandate. At the core of it, the government felt that CDC could achieve much more impact. That's really what we've been trying to do for the last five years.