KEY POINTS How the Technology InnovationChallenge Opens the Doorto New Solutions •In 2019, the Asian DevelopmentBank (ADB) created theTechnology InnovationChallenge (TIC) with $4.5million in funding from theHigh-Level Technology Fund, asa new and unique modality tosupport technology innovation. INTRODUCTION •By late 2025, the TIC hadsupported 11 proof-of-conceptprojects in energy, urbandevelopment, transport, andhealthy oceans, providingreal-world testing conditionsthat helped technologyproviders, ADB teams, andDMCs jointly de-risk innovationthrough rapid deployment,lower market-entry risks,and evidence to informbroader adoption. The Asian Development Bank (ADB) is changing how it supports its developing membercountries (DMCs) to better enable innovation, promote private sector engagement, andbecome a more solutions-focused service provider. When an ADB project team alreadyknows the technology they want to deploy, the relevant suppliers can be reached andcompete through ADB’s robust procurement system. However, both DMCs and ADBteams have emphasized the need to test new technologies in ways that minimize risks. In response to this need, the Technology Innovation Challenge (TIC) was created in2019 as a new and unique modality to identify and select innovative technologies tosolve a predefined problem. This competition fosters partnerships between internationaltechnology providers and local partners, and de-risks technology adoption in newenvironments. It facilitates knowledge transfer by piloting innovative solutions andincreases the visibility of lesser-known technologies in DMC contexts. The TICis a testing ground, a modality designed not for impact at scale, but for somethingmore fundamental—proof of viability. Funding for the TIC comes from the High-LevelTechnology (HLT) Fund, a multidonor trust fund established in 2017 by theGovernment of Japan. •The TIC is structured such thatit can accommodate pitchesfrom entities of differentsizes and levels of maturity,widening ADB’s knowledge baseabout available technologies,providers and partners,supporting the development oflocal innovation ecosystems. The TIC aims to accelerate the use of innovative technologies in DMCs and attracttechnology providers through a grant-making system that provides funding for pilotdemonstrations. These can be technologies that are brand new but have been tested inother countries, existing technologies combined in a new way, or technologies not yetused in any DMC. The TIC was also designed to increase awareness about innovationsin both DMCs and within ADB. •The model demonstrates howstrategic grant funding cancatalyze private investment andpromote technology adoption inchallenging markets, supportedby clear evidence of what works,more targeted engagementwith innovators, strongercollaboration with local partners,efficient implementation, anda sharper focus on supportingsolutions with potential to scale. The TIC tests the viability of innovative technologies under real-world DMC conditions.It offers advantages for all three parties (Figure 1). For the technology providers, it enablesthem to engage with ADB and take their technology to new markets together with Notes: In this publication, “$” refers to US dollars. ADB recognizes “Bombay” as Mumbai.This publication was prepared by Susann Roth, advisor, Department of Communications andKnowledge Management (DOCK), Asian Development Bank (ADB); Rika Hayashi, principal knowledgemanagement specialist, DOCK, ADB; Emeli Möller, innovation challenge specialist consultant, DOCK,ADB; Jane Parry, knowledge management expert consultant, DOCK, ADB; Ian Agsalda, associateknowledge management officer, DOCK, ADB; Abigail Armamento, technical assistance coordinatorconsultant, DOCK, ADB; Josephine Aquino, operations officer, Energy Transition Mechanism TrustFund, Sectors Department 1, ADB. ISBN 978-92-9277-725-8 (print)ISBN 978-92-9277-726-5 (PDF)ISSN 2071-7202 (print)ISSN 2218-2675 (PDF)Publication Stock No. BRF260086DOI: http://dx.doi.org/10.22617/BRF260086 HOW THE TECHNOLOGY INNOVATIONCHALLENGE WORKS local partners, with a reduced level of risk. For DMCs, it providesknowledge and insight for new technology solutions, and the fundedpilots can reduce the risk of larger-scale implementation failure. ForADB, it offers a new way to engage and partner with technologyproviders and creates potential lending opportunities. Thetechnology providers, DMCs, and ADB all gain knowledge of howviable a specific technology can be in a developing country setting,and can explore its potential for scaling. The TIC begins with a development problem that is consistentwith country priorities (Figure 2). This development challenge isthen posted on a dedicated platform, and technology providers areinvited to submit their projects.2 The TIC is aligned with ADB’s Strategy 2030, which supportstechnology adoption in DMCs by de-risking the adoption ofinnovative technologies and expands ADB’s private sectorpartnershi