The Mastercard Foundation Africa Growth Fund (The Fund), a Fund-of-Funds of African investment vehicles (IVs) to support early-stage, growth-oriented SMEs, launched today with $200 million (USD).
The goal is to enable dignified and fulfilling work for youth, particularly young women. The Fund is bold and catalytic, helping to crowd in capital for African entrepreneurs by strengthening and de-risking African IVs that advance gender equity in entrepreneurship.
In addition, the Fund will offer a business development facility for its portfolio companies. The initiative will use gender-lens investing (GLI) principles to promote the Mastercard Foundation’s Young Africa Works strategy, which aims to enable 30 million youth in Africa, particularly young women, to access dignified and fulfilling work by 2030. So far, the MFAGF has recruited two IVs supporting entrepreneurial growth – one in East Africa and one in West Africa.
African-owned IVs, led, and based are considered high-risk. At the same time, African SMEs struggle to access the financing they need to scale, inhibiting their potential. The Fund tackles both challenges by investing in and strengthening African IVs that in turn support African SMEs.
“We need to do everything it takes now to build a continent with shared prosperity and sustainable, inclusive growth,” says Dr Dorothy Nyambi, President and CEO of MEDA
“This Fund-of-Funds will strengthen a new crop of African IVs to drive decent job creation for women and youth via investments in small and medium-sized enterprises.” Dr. Nyambi added that success lies in increasing youth employment and moving from talk to action.
“More than 75 per cent of ventures funded will be led by women creating jobs,” Dr. Nyambi said. “Ultimately, our impact will be in building the investment ecosystem for investment vehicles and in the SMEs that will thrive and create dignified employment.”
“The MFAGF has built up a promising pipeline of 180 diverse investment vehicles, including Early-stage, Growth, Debt and Seed VC Funds and other non-traditional funds,” says Samuel Akyianu, MFAGF Chief of Party/Managing Director. “Five have gone through our investment screening process, two female-led investment vehicles are past due diligence and received a favourable investment decision.”
Akyianu explains that the main objective is to make investments that generate positive, measurable social and environmental impact while building a stronger and more vibrant African investment ecosystem. He says the Fund is committed to measuring and reporting decent job creation for Africa’s youth through a process that incorporates gender, diversity, inclusivity, and social, and environmental performance.
The Fund-of-Fund’s vision is led by MEDA and implemented by a consortium of partners, including Investisseurs & Partenaires (I&P) and Entrepreneurial Solutions Partners (ESP), Genesis Analytics, the Criterion Institute, and Africa Communications Media Group.
