I&P Afrique Entrepreneurs II

Equity : February 2019

I&P Afrique Entrepreneurs II LP is a 10 year closed-end investment fund with a €80 m target size.

Amount

€ 5,000,000.00

Type of investment

Equity

Development impacts

Local economic growth
Private sector consolidation/innovation
Promotion of ESG best practices

Beneficiary locations

Sub-Saharan Africa:

Investment field

Investment Companies & Funds

Activity

SME Fund

Organisation

I&P Afrique Entrepreneurs II

Website

http://www.ietp.com/en

Domicile

Mauritius

IPAE2 aims at financing around 35 small SMEs in Africa through investments of € 0,5 to 3m which is generally considered as the «missing middle». Its mission is to promote the emergence of a new generation of responsible African entrepreneurs by investing minority equity and quasi-equity stakes in mainly mature but also early-stage SMEs, operating in Western and Central Africa, in the Indian Ocean region and to a lesser extent in Eastern Africa.

A first closing of the fund was held at € 50m in December 2017. IPAE2 follows the same philosophy as its predecessor fund IPAE, which closed in 2012 at € 53,9m, and during its investment period which ended in May 2017, committed € 30m to 29 companies.

IPAE2 and IPAE are managed by Investisseurs & Partenaires (“I&P”), a French fund manager.

I&P was created in 2002 and manages four impact funds (Ipdev, IPAE, Ipdev II and IPAE2) representing €125 million. Through these funds, I&P has supported about 60 small and medium-sized enterprises, located in 15 African countries, mainly in West and Central francophone Africa and the Indian Ocean Region, where long-term funding solutions for SMEs are almost non-existent. Over the years, they have developed a specific investment approach adapted to these targets, combining financial tools and strategic/operational support, and have opened offices on the ground.

Development impacts

Local economic growth
Long term equity financing will be provided by the fund to around 35 African SMEs, in markets where SMEs usually face major issues to finance their growth, as local banks scarcely provide local debt to SMEs and capital markets typically focus on the larger companies.
Private sector consolidation/innovation
Know-how and technology transfer to investees:
Know-how transfer is realized through capacity building/TA projects mainly financing and managerial support). Also, I&P often is the first third party investor, thereby also formalizing some aspects of the company and upgrading its governance.

Financial and accounting practices generally need to be upgraded to enable both management and shareholders to adequately track the company’s performance ; Through their participation to the Board of SMEs, IPAE2 will ensure that Financial and accounting practices improves and if needed IPAE will support their investee with TA.

IPAE2 will require the establishment of a Board of Directors to manage the company in a concerted manner. One or two independent directors will be included when appropriate and possible, to bring additional expertise with an independent view.
Promotion of ESG best practices
ESG is part of I&P's core strategy and they have developed a method and a tool (derived from CDC toolkit) to analyse and monitor E&S aspects adapted to African SMEs. For instance they promote the adoption of health insurance plans at the level of their investees. I&P ESMS is considered comprehensive and of good quality.

I&P promotes good governance practices at each investee company as it systematically requires board seats in the portfolio companies and insists on regular meetings being organised

Made possible through this investment

Thanks to the direct funding from BIO, the following second-line investments have been made possible.

Afribon

AFRIBON, launched in 2012, is specialized in the creation and marketing of food flavours. The group has five production sites in total: four in East Africa (Kenya, Uganda, Rwanda, Tanzania) and one in Cameroon. AFRIBON is currently the only company to produce locally and offer a tailor-made service to its customers, including notably manufacturers of beverages, biscuits and dairy products.

AMI

Launched in 2014, The African Management Initiative (AMI) provides formalized training to empower managers and entrepreneurs. AMI has developed over 45 practical business modules – including over 2,000 tools – with Africa’s leading business schools and global experts on adult learning. Through its programmes, AMI aims to reach 20,000 people in 11 African countries.

CoinAfrique

CoinAfrique is a 100% mobile community platform designed to buy and sell products simply. Created in 2015, CoinAfrique aims to become the leader in online ads between individuals in French-speaking Africa. To date, CoinAfrique has over 500,000 downloads and more than 100,000 active users.

Soafiary

Madagascar

Founded in 2006 by the Malagasy promoter Malala Rabenoro, SOAFIARY is specialized in the sourcing, processing and commercialization of cereals (maize, rice) and leguminous plants (beans, cape peas, lentils, soybeans) on local and international markets. The company employs nearly 200 people, including 88% women.

New Crystal

Ghana

New Crystal Health Services (NCHS) is Ghana’s leading private health care group dedicated to the urban poor. From its modest beginnings in a four-bedroom facility in 2003, New Crystal now serves an average of 300,000 customers per year through a chain of six networked clinics, a diagnostic services company and a pharmaceutical wholesale and retail company. NCHS provides general consulting services in health care, surgery, optics, dental care and other diversified health services.

Rensource

Nigeria

Rensource is a distributed energy services company that delivers power and value-added services to SME clusters in Nigeria through ring-fenced, solar powered micro-utilities. In 2018, the company launched its first micro-utility project with financial backing from Paris-based NEoT Capital through its NEoT Offgrid Africa investment platform. The project is located at the Sabon Gari Market in Kano State and today provides clean, affordable and reliable energy to over 4,000 merchants, with an additional 8,000 set to go live by Q3 2019.

Procréa

Côte d'Ivoire

The medical-surgical clinic PROCREA, based in Abidjan, began operating in 2008. It specializes in the field of reproductive health and is the leader in Côte d’Ivoire in Assisted Reproductive Health Care (AMP), a technique that treats people with infertility issues and helps them to achieve parenthood.

PROCRÉA also provides mother-child care, including obstetrical gynecology, neonatology (newborn care), and pediatrics.