SMALL AND GROWING BUSINESS FUND

0$

Presentation of the donor

About GroFin: GroFin is a pioneering development financier specializing in financing and supporting small and growing businesses (SGBs) across Africa and the Middle East. GroFin combines patient capital and specialized business support to grow emerging market enterprises.

SGB Fund: First of its kind, uncapped and unlimited-life fund to support growth of small and growing businesses in Africa. Officially launched by GroFin on September 23rd, 2015.

Summary of opportunity

Focus: Focus on Small and Growing Businesses (SGBs) that are grossly underserved by other funds or financiers. Delivers a unique integrated solution for patient risk capital and end-to-end business support to start-up and growing businesses at the SME base.
Locations: Nigeria, Ghana, Zambia, Egypt, South Africa, Kenya, Tanzania, Rwanda, Uganda
Investors: Shell Foundation, KfW, Dutch Good Growth Fund, Norfund, GroFin.
Objectives:
  • 80 – 100 investments per year at an average deal size of USD $100,000- USD $1.5 million in local currency. The fund typically provides finance in forms of medium term loans.
  • Over 10 years the growing SGB portfolio will sustain 32,000 employees as part of its impact.
  • A specialist fund manager with a proven track record and local capacity in 9 countries in Africa.

Eligibility criteria

  •  Geography: We finance and support businesses that operate in countries where GroFin has an operational office namely in South Africa, Zambia, Ghana, Nigeria, Ivory Coast, Uganda, Kenya, Tanzania, Rwanda, Egypt, Oman, Iraq, and Jordan, to enable us to offer regular value-adding business support.
    Applications from businesses that operate in other countries cannot be considered
  • Sectors of focus: The business operates in one of the investment focus sectors of Education, Healthcare, Agri-processing, Manufacturing, Energy, Water/Sanitation and labour-intensive businesses. Other sectors can be considered on a case-by-case basis.
  • Business Profile: We typically invest in businesses with these maturity profiles:
  • Early stage (1-3 years) Start-ups are considered when they are backed by an entrepreneur with significant experience, track record and material financial commitment to the venture.
  • Early maturity (3-6 years)
  • Mature (>6 years)

GroFin considers businesses in all sectors with exception of those activities that have significant potential negative social and environmental impacts. We also do not invest in financial intermediation businesses or non profits such as NGOs, and community groups. Primary agriculture is only considered if it takes place in a controlled environment and at scale.​

  • Investment Size: We invest between US$ 100K – US$ 1.5 M in the business, preferably as self-liquidating debt.
  • Duration of finance: Typically, 3-8 years. Loan repayment term must be aligned with the purpose of the loan.
  • Entrepreneur Profile: The entrepreneur should have significant own investment in the business, have the ability to manage a business – from operations, sales, financial management, administration, and leadership. They must be willing to work with us as a value adding financier and share management information regularly. They must have growth ambition and demonstrate integrity as well as professionalism in their dealings.
  • Collateral requirements: Though GroFin has no minimum requirement, we do expect entrepreneurs to (partly) secure the loan if collateral is available. Quality and value of collateral does play an important part in the overall risk assessment. Personal guarantees of the entrepreneur(s) is required.
  • Social Impact: The business must be able to have a measurable impact in terms of the number of jobs supported and sustained, female ownership, female employment and semi-/unskilled labour. SMEs that provide indirect job opportunities (e.g. training, skills development) and/or environmental services (water, waste, energy, ecotourism) are also attractive to GroFin.​​
  • Business support: GroFin delivers business support to clients prior to the investment and during the tenor of the loan – focusing on improving business viability, sustainability and growth through identifying material business risks/opportunities across a range of generic areas as identified during the screening/due diligence stage. For this reason, entrepreneurs need to be receptive to receiving advice and implementing recommendations, normally around improving formalisation of their business.

How to apply

Application process: Please start your application with Pre-Qualification Assessment on GroFin portal.

Website