The investment company I&P Développement 2 (IPDEV 2), managed by Investisseurs & Partenaires, an experienced fund manager dedicated to African SMEs, reached its final closing and totalizes an investment capacity of €21 million, exceeding its initial target. With the support of long-term committed investors, including the African Development Bank and Soros Economic Development Fund, IPDEV 2 will be in a position to achieve its mandate: training, sponsoring and launching ten impact funds in Sub-Saharan Africa. Five impact funds have already been launched in Burkina Faso, Côte d'Ivoire, Madagascar, Niger and Senegal.
IPDEV 2 REACHES ITS FINAL CLOSING WITH SUPPORT FROM LEADING IMPACT INVESTORS
Following a first closing at €9.5 million in October 2015, IPDEV 2 realized its final closing at €11.5 million, bringing its equity to €21 million. This final closing brings together seven new investors, including individuals, private and institutional investors (African Development Bank, Ceniarth, BNP Paribas, Soros Economic Development Fund) and two investors already present in the first closing, the Adolf H Lundin Charitable Foundation and FISEA, the Investment and Support Fund for Businesses in Africa managed by Proparco.
“IPDEV 2 is the first impact investing projects of this kind supported by the African Development Bank. Not only does it allow small and early-stage enterprises to access capital, but it also strongly focuses on the capacity building of African investment teams: IPDEV 2 paves the way to extend the reach of impact investing in Sub-Saharan Africa” says Stefan Nalletamby, Director of the Financial Sector Development Department at the AfDB.
“IPDEV 2 has a proven track record of helping to catalyze early-stage entrepreneurship in Africa through its mentorship of local investment teams. These teams are deeply rooted in their communities, and are best positioned to allocate resources into SMEs that are otherwise excluded from the formal financial system. These SMEs increase economic opportunities for the vulnerable populations we seek to reach”, notes Manuel Costescu from the Soros Economic Development Fund, a part of the Open Society Foundations.
In addition to its own €21 million investment capacity, IPDEV 2 has raised €15 million from African co-investors, who invest in the African funds. Finally, IPDEV 2 is also a blended finance program: a €19m grant program has been secured covering a Technical Assistance Facility for SMEs as well Seed Funding for SMEs and start-ups.
LAUNCH OF FIVE MORE IMPACT FUNDS IN THE COMING YEARS IN SUB-SAHARAN AFRICA
Since its inception 3 years ago, IPDEV 2 has launched five African impact funds: Teranga Capital in Senegal, Comoé Capital in Côte d’Ivoire, Miarakap in Madagascar, Sinergi Burkina in Burkina Faso, Sinergi Niger in Niger. Together they have already financed 27 early-stage SMEs in equity and seed funding and raised €15m in local and international capital.
IPDEV 2 will sponsor another five impact funds in the coming years in West, Central and East Africa. IPDEV 2 partners with each impact fund manager by bringing capital, tools, coaching and a network of African and international mentors, investors and entrepreneurs. IPDEV 2 will be selecting 5 additional committed and talented first-time investment teams to manage the next 5 funds.
The overarching goal pursued by IPDEV 2 is to finance promising African start-ups and early-stage businesses. Despite their considerable growth and impact potential, many African SMEs remain neglected by the financial sector as they are costly to reach and face stronger barriers in raising funds. In the coming decade, the funds sponsored by IPDEV 2 will aim to circumvent these barriers and finance up to 500 early-stage SMEs in ten countries, with investment needs between €20,000 and €500,000.
“With IPDEV2, I&P expands the reach of impact investing to the most early-stage entrepreneurs and start-ups on the continent. At the same time, IPDEV2 also connects the ecosystem of African investors to the most promising SMEs with the highest professional standards of equity investment” explains Jean-Michel Severino, CEO of Investisseurs & Partenaires. Through this innovative mechanism, IPDEV 2 contributes to promoting the emergence of new champions of African entrepreneurship as well as building a community of investment professionals across the continent.
ABOUT INVESTISSEURS & PARTENAIRES
Investisseurs & Partenaires is an impact investment group dedicated to African Small and Medium Enterprises. Since its creation in 2002, I&P has invested in more than 90 companies, located in 16 African countries and operating in various sectors of activity (health, transport, microfinance…). These enterprises create local added value and long-term employment, and generate important social, environmental and governance impact.
I&P provides capital, technical and strategic support to meet the growth needs of its portfolio companies. The team develops long term partnerships with entrepreneurs, sharing management expertise and knowledge that is useful for improving business strategy, structuring, and success. I&P manages four pan-African funds – IPDEV 1, IPDEV 2, IPAE 1 and IPAE 2, which represent a total of €135 million – and sponsors five African impact funds – Comoé Capital (Côte d’Ivoire), Miarakap (Madagascar), Sinergi Burkina, Sinergi Niger and Teranga Capital (Senegal).
Created by Patrice Hoppenot in 2002 and headed by Jean-Michel Severino since 2011, the I&P team comprises about forty collaborators in Paris and in its seven African offices in Burkina Faso, Cameroon, Côte d'Ivoire, Ghana, Madagascar, Niger and Senegal.
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Chief Operations Officer IPDEV 2