I&P Afrique Entrepreneurs I (IPAE1)
Last updated 11 May 2020, by Impactyield.
I&P Afrique Entrepreneurs 1 (€(54m) is the 2nd vehicle managed by Investisseurs & Partenaires (I&P), an impact investment group dedicated to African SMEs.
IPAE1 targets the "missing middle", ie SMEs and MFIs in Africa and expects to achieve both impact objectives and good financial returns through a 5 to 7 year investment period.
I&P is an active partner bringing its know-how in management and finance within an entrepreneurial approach. I&P's model entirely hinges around the entrepreneur, with whom I&P is willing to establish a long-term relationship based on trust.
Since 2012, the IPAE team has constituted a significantly diversified portfolio of 29 investments. The fund's diversification mitigates political & macro-economic risk:
- Geography: a dozen of countries are covered, half of them being least developed countries ( in West Africa, Central Africa, the Indian Ocean & Eastern Africa).
- Sectorial approach: with investments in companies operating in a broad set of sectors (Agri-business, Microfinance, Construction Industry, Transport, Health, Services, IT, Renewable energies, …) offering B2C goods & services for both middle class and low-income individuals, but also providing B2B goods & services to companies based in Africa.
- A combination of investees at different growth stages, with ¼ of investment in start-ups and ¾ of companies at their expansion stage.
I&P Afrique Entrepreneurs invests in SMEs in their early, development stage or turnaround.
-SMEs (including start-ups), employing on average from 10 to 250 people with a turnover ranging from €200k to € 10m.
-MFIs : greenfield, in association with a Microfinance operator or microfinance projects to be converted into private companies, development and consolidation of existing MFIs, small commercial financial institutions facing strategic challenges.
-In diversified sectors (health, food-processing, agriculture, public works, retail, services, microfinance…)
-Showing a strong potential for value creation and managed by skilled local entrepreneurs/managers
-In search of mentoring and advice
IPAE uses different kinds of financial instruments: minority equity and quasi equity with a holding period of 5 to 6 years.
Since 2012, the IPAE team has constituted a portfolio of 29 investments in Africa, representing €29m of commitments. The average deal size stands at €1m.
Equal rights to ownership basic services technology and economic resources
Encourage companies to adopt sustainable practices and sustainability reporting
Sustainable food production and resilient agricultural practices
Full employment and decent work with equal pay
Increase access to financial services and markets
Key performance indicators
Asset manager: Investisseurs & Partenaires (I&P)
Product track record: Fund has 10 years of track record
Target IRR: n.a.
Committed Capital: n.a.
Target return category: Risk-adjusted market-rate of return
Fund domicile: Mauritius
Product status: Closed - still investing
Inception year: 2012
Vintage year: 2012
Target close date: n.a.
Product term: 10 years +2x 1-yr ext
Assets under management: 54,000,000 EUR (Euro)
Investment size: Min: 300,000; Max: 1,500,000; Avg: 700,000
Currency of investments: EUR (Euro)
Currency for fund / product figures: EUR (Euro)
Fund investments to date: 29
Fund investments to date exited or repaid: 0
Management fee: n.a.
Carried interest: n.a.
Hurdle rate: n.a.
GIIN Investors' Council Investment: No
Limited Partners / Investors: the European Investment Bank, the French Development Agency, FMO, the AFrican Development Bank, Danone, Caisse des dépôts, CFAO, other corporate and individual shareholders
Limited Partner / Investor Type: Development Finance Institution (DFI), Family Office, Other Institutional Investors
I&P Afrique Entrepreneurs aims to develop an efficient private sector and strengthen the economic fabric in Africa, through investments in SMEs and MFIs.
The Fund supports the creation and development of high potential SMEs. It helps them become more competitive, autonomous and sustainable; Thus they will create value, services, capabilities and jobs ; They are also incentized to improve their governance, their social management and their impact on the environment.
Investments target SMEs showing a strong impact in terms of (i) local added value (processing from local sourcing), (ii)development of the value chain (concentrating on bottlenecks), (iii) creation of local markets for smallholders, (iv) access to quality goods and services to local populations, (v)job creations.