UMUNTHU II Secures EUR 57 Million First Close to Support Inclusive Businesses in Africa

Goodwell Investments, together with its long-standing partner Alitheia Capital, is delighted to announce the participation of a diverse group of investors in their mission to finance inclusive growth in Africa.

The involvement of these investors reflects the organizations’ positive outlook on the continent’s potential for impactful opportunities, particularly at a time when businesses in other regions are facing challenges. The initial close of the uMunthu II fund has successfully attracted EUR 57 million from a combination of family offices, private investors, and institutional investors. This strong start has generated significant momentum, and the fund is expected to achieve its final close within two years, with a minimum target of EUR 150 million.

Goodwell and Alitheia hold a highly optimistic view of the current growth prospects in developing markets, with a specific focus on the African continent. The underlying market dynamics are robust, characterized by a youthful and expanding population, as well as a rapidly growing digital infrastructure. These factors create an environment conducive to innovative business models that can effectively reach mass markets of consumers who have increased spending power.

Els Boerhof, managing partner of Goodwell, expressed great enthusiasm for the opportunities presented by these market conditions:  “The challenge is that even with this progress, millions of households lack access to affordable basic goods and services. At the same time, this group has significant buying power. The African market provides a huge opportunity for impact and economic growth, especially during turbulent economic times, as we learned once again during recent crises. African economies and specifically inclusive businesses that provide essential products are highly resilient and continue to grow, contrary to global developments. Because crisis or not, unmet demand for basic goods and services on the continent will rise for an ever-growing group of underserved users.”  

Leveraging their extensive expertise in impact investing spanning almost two decades, Goodwell Investments and Alitheia Capital are dedicated to bridging the gap in Africa by investing in local entrepreneurs and offering homegrown solutions to local challenges. To ensure effective support, the investments will be overseen by investment teams led by women, operating in the same regions as the entrepreneurs they collaborate with.

Tokunboh Ishmael, co-founder and managing director of Alitheia Capital comments: “uMunthu II will tap into the huge potential of inclusive businesses that provide high-quality, reasonably priced goods and services for underserved low-income groups, such as food, housing, transportation, and healthcare. Improving access to these essentials directly links to increasing participation in social and economic networks and improving livelihoods. Funding from uMunthu II will enable these innovative entrepreneurs to build businesses that reach millions of underserved end-users while delivering positive social and environmental impact and market-rate financial returns.” 

African entrepreneurs face a funding gap despite the presence of growth prospects. In 2022, venture capitalists invested a record USD 6.5 billion across the 54 African countries. However, this amount pales in comparison to the staggering USD 200 billion raised solely in the United States during the same period. To address this issue, uMunthu II is focusing on investing in early and growth-stage SMEs while actively seeking out women-led businesses. Presently, only 15% of venture capital funding is directed towards companies founded and/or led by women.

uMunthu II is building a robust portfolio by partnering with feeder funds that have already invested in nine companies, including Copia, Chicoa Fish Farm, Sendy, Good Nature Agro, Instill Education, and Origen Fresh. These investments exemplify the overall strategy of targeting high-impact sectors.

Furthermore, in addition to expanding the uMunthu II portfolio, Goodwell aims to attract new family offices and institutional investors to its network. These investors should be seeking growth opportunities aligned with their impact and financial objectives. It is crucial that they understand the immense potential for creating social and environmental impact on the African continent while also delivering competitive financial returns.

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