Investors update: $5m impact fund for SA SMEs

SAB Foundation launches $5m impact fund for SA SMEs

Highlights

• SAB Foundation, in partnership with Lead Impact Capital and the National Treasury’s Jobs Fund, has launched an R88 million ($5 million) Financing for Impact Fund.
• The fund, underpinned by grant capital, is aimed at providing affordable financing to qualified alumni of its South African entrepreneur programs.
• On a broader scale, the Fund seeks to mitigate the financing gap that exists in South Africa, especially for small businesses, which often do not have much collateral and are perceived as high risk by the investment community.

Source: Ventureburn

Our Takeaway

Lack of access to working capital remains a huge problem facing the growing small and mid-sized retail sector in South Africa and the continent at large. Available data shows a $330 billion financing deficit for the small enterprises that make up 90% of businesses on the continent—and it’s a problem several startups and foreign investors are particularly keen to address as it promises attractive returns. In addition, the new fund is the latest in a long list of impact funds that have launched in Africa this year, showing its rapid growth.

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d.light raises additional $1.9m from Swedfund to power Africa

Highlights

• Swedfund has made an additional investment of $1.9 million in d.light, a company providing affordable off-grid solar electricity to people living without access to reliable and clean energy in Africa and India. 
• The funding will be used for supporting the company’s further expansion and comes after Swedfund’s initial investment in December 2018.
• Since then, d.light has expanded from Kenya and India to new geographies such as Uganda, Tanzania, and Nigeria, and has also introduced new products and services.

Source: ABC

Our Takeaway

Against the backdrop of a challenging macroeconomic and financial environment, high inflation disproportionately affects the most vulnerable. More Africans are lacking electricity in 2022 than in 2019 and electricity services are now unaffordable for up to 30 million people who had previously gained access to power. The lack of access to electricity is both a root cause and a consequence of poverty. With this latest investment, Swedfund asserts its continued efforts to eliminate poverty and foster economic growth in Africa and India.

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StanChart launches female-focused startup incubator in Kenya

Highlights

• Standard Chartered Women in Technology Incubator Kenya has launched, combining startup support with local and international experience to support female founders and help them grow their businesses.
• The program, an initiative of Standard Chartered in partnership with Strathmore University’s iBizAfrica incubator, offers immersive learning, mentorship, and building and growing startups with the support of seed capital.
• StanChart is seeking female founders with businesses that embed components of emerging technologies in building their solutions – such as artificial intelligence, the Internet of Things, big data, machine learning, robotics, blockchain, and augmented and virtual reality.

Source: Disrupt Africa

Our Takeaway

In Africa, female entrepreneurs are taking their place in the male-dominated tech world. However, gender bias still makes it harder for them to access finance and grow their businesses. Per Briter Bridges, only 3% of the total funding raised by startups in Africa since 2013 has gone to all-women co-founded teams. Efforts and initiatives like this are crucial to increasing female representation in and contribution to the startup space, which remains minute against a faster-growing percentage of ventures run by men.