Alithea IDF announces largest gender-neutral private equity fund in Africa
The first female-led, women-focused private equity fund, Alitheia IDF (AIF), has announced the final closure of the $ 100 million (R 1,552,898,000.00) fund with the European Bank of investment (BEI) which joins as final investor with $ 24.6 million. With this final close, Alitheia IDF becomes the largest gender-focused private equity fund in value in Africa.
Led by key partners Polo Leteka and Tokunboh Ishmael, Alitheia IDF invests in growing companies in six African countries: Nigeria, South Africa, Ghana, Zimbabwe, Lesotho and Zambia.
The fund’s mandate is to close the investment gap of more than $ 42 billion between male and female entrepreneurs to catalyze the economic power of African women as producers, distributors and consumers. In 2021, the fund began implementing this mandate by leading investment cycles in five women-led companies in critical sectors including agribusiness, education, manufacturing, housing, technology and logistics. The beneficiary companies are Jetstream Africa (Ghana), ReelFruit Ltd (Nigeria), SKLD (formerly SchoolKits, Nigeria), AV Light Steel (South Africa) and Chika’s Food (Nigeria).
One of the first drivers was when I realized that a lot of the capital I was deploying was going to male founders and male-run companies in predominantly male industries.
“Globally, women have enormous purchasing power as consumers and controllers of the home economy. Likewise, women entrepreneurs have a significant presence in the SME sector in Africa, with African women making up 58% of the continent’s self-employed population. However, despite this economic power and presence, African women are underserved as consumers and producers. This has had a huge impact on economic growth as the potential of more than half of the continent’s population remains untapped due to structural and systemic issues. We are proactively working to fill this gap with a clear mandate to support women-led businesses across the continent while raising awareness of gender investments as a path to inclusive economic growth, ”said Tokunboh Ishmael, lead partner in Nigeria.
African women have remained underserved by the financial sector even as the historic investment gap between men and women continues to widen. Estimates show that African women receive less than 5% of all investments on the continent, even though more than 40% of small and medium enterprises (SMEs) in Africa are headed by women. McKinsey reports point out that closing the investment gap will lead to 26% growth in gross domestic product (GDP) ($ 28 trillion) by 2025. By applying a gender lens to investment, Alitheia IDF sets the tone and provides a framework for gender mainstreaming investments with the aim of enabling the economic growth of African countries and, above all, African women.
Polo Leteka, lead partner in South Africa, explained that she hoped Alitheia IDF’s example would inspire other investors on the continent to invest in women, noting that women have an important role to play in unlocking Africa’s economic potential. She further stated that “the historic inability to appropriately capture the economic potential of African women has affected Africa’s development. Alitheia IDF’s mission is to fill this gap by using a gender perspective and financial capital to empower women as consumers and producers.
EIB Vice-President Thomas ÖSTROS said: “Women-owned businesses still struggle to raise funds, although they have proven their performance. I am very happy to support a true 2X flagship fund “by women for women” that invests in businesses that create employment opportunities while improving diversity in the economy of sub-Saharan Africa. The EIB’s investment in Alitheia IDF is part of our SheInvest initiative to mobilize € 2 billion in investments to boost gender equality and women’s economic empowerment on the African continent. I truly believe that gender equality makes societies stronger.
Alitheia IDF is supported by investors on four continents: the African Development Bank, the Bank of Industry Nigeria, FinDev Canada, the Dutch Good Growth Fund and the European Investment Bank. In 2019, the fund announced its first close at $ 75 million with the President of the African Development Bank (AfDB), Akinwumi Adesina, saying at the time that Alitheia IDF had fulfilled its pledge to raise funds for them. businesses run by women. “Promise made, promise kept! did he declare.
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