Africa’s impact investing ecosystem is under transformation. Development finance institutions are among the most active investors, but a fast growing number of fund managers and companies are attracting capital from local limited partners (see, “African investors warm to regional funds of funds to finance small business growth”).
ImpactAlpha’s recent reporting has covered 10 African LPs backing funds in Tunisia, Ghana and Egypt.
Banque Internationale Arabe de Tunisie, for example, is among the local LPs in ANAVA, a fund of funds designed to funnel capital to Tunisian startups and small businesses.
In Ghana, a similar fund of funds, Ci-Gaba, has raised from local institutional investors, including pension funds. Mirepa Investment Advisors, also in Ghana, raised its first fund entirely from local pension funds and other investors, including Petra Trust Pensions, Secure Pension Trust, Fidelity Asset Management, Stanbic Investment Management and Venture Capital Trust Fund.
“For us, that’s pretty significant,” Mirepa’s Samuel Yeboah told ImpactAlpha. “It demonstrates that we actually can mobilize capital locally.”
Four Egyptian banks and investment managers, e-Finance Investment Group, Banque Misr, National Bank of Egypt and Banque du Caire, invested in DPI’s Nclude Fund, a fintech fund focused on North Africa.
Other local fund managers, including WIC Capital in Senegal and Chui Ventures in Kenya and Nigeria, have succeeded in raising capital from local high net-worth individuals and entrepreneurs.
DFI dealmaking
Development finance institutions are named most often in African fund managers’ funding milestones. ImpactAlpha’s recent reporting has covered deals from at least nine DFIs, multilateral banks and other publicly-backed development agencies.
The UK’s British International Investment, Germany’s KfW and the World Bank also backed ANAVA, for example. KfW is invested in Sahel Capital’s Social Enterprise Fund for Agriculture in Africa, which provides flexible financing to high-impact agribusinesses serving smallholder farmers across the continent. KfW also invested in Cygnum Capital’s Africa Local Currency Bond Fund to help African lenders reduce reliance on hard-currency debt.
British International Investment, meanwhile, has stood up its own small business investment firm in Ghana, Growth Investment Partners. Another UK government-backed investment entity, FSD Africa Investments, is an LP in Cygnum’s Africa Local Currency Bond Fund, ARM-Harith’s Climate and Transition Infrastructure Fund, and Holocene Ventures’ first fund, which provides local currency and early-stage risk capital.
Sweden’s Swedfund invested in TLG Capital’s second Africa Growth Impact Fund and AfricInvest’s Financial Inclusion Vehicle, which supplies growth capital to financial institutions in the region.
The International Finance Corp., the private-sector arm of the…
Read More: Ten LPs investing in African impact funds
