The International Finance Corporation (IFC) is investing $10 million into Nigeria and Ghana to expand access to finance for high-growth, underserved small and medium enterprises (SMEs) in both countries.
“This funding represents a significant step towards catalysing growth in small and medium enterprises in Nigeria and Ghana. We look forward to working with the IFC as a partner in this fund as we strive to continuously bring the best practices in operating standards to our investments and investee companies, ” noted Yomi Jemibewon, Co-Founder and Managing Director of CardinalStone Capital Advisers.
Here Is All You Need To Know
- The fund will be managed by CardinalStone Capital Advisers (CCA) — an investment management firm under its CardinalStone Capital Advisers Growth Fund (CCAGF), a private equity fund.
- CardinalStone Capital Advisers which is seeking $100 million in total for the CCAGF fund, has already secured $50 million in capital commitments from the CDC Group, the UK’s development institution; Kuramo, a leading African investment firm; FMO, the Dutch Development Bank; and NSIA, the Nigerian sovereign wealth fund; among other investors.
“IFC’s investment in CardinalStone will spur growth of SMEs and facilitate much-needed job creation while creating the ecosystem for a more robust local private equity and mezzanine financing market,” said William Sonneborn, IFC Senior Director for Disruptive Technology and Funds. “By supporting SMEs in fast-growing markets, we hope to bring best practices that raise the bar for operational improvements and environmental and governance standards across the investee companies.”
Read also: International Finance Corporation (IFC) injects $1 million into Flat6Labs Tunis (Anava Seed Fund)
Why CardinalStone Capital Advisers Growth Fund Is Out For Under-served SMEs
The fund is possibly looking to finance SMEs and Nigeria and Ghana because a 2017 ResearchGate publication has noted that SMEs in Africa make up about 50% of the continent’s GDP and account for 60% of employment figures and about 90% of all businesses.
In Nigeria alone, SMEs account for 96% of businesses in and 85% of the private sector in Ghana. With all these in mind, CardinalStone says the fund will support SME growth opportunities by providing long-term capital as well as operational expertise to ensure business sustainability.
The investment is part of the IFC SME Ventures program that supports high-growth entrepreneurs in frontier markets by investing in funds that provide risk capital. The programme, according to International Finance Corporation , has financed over 100 SMEs, which have created over 6,000 direct jobs, many more indirect jobs, and generate tax revenues for governments.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world