I&P Expansion

Ed Partners Africa is a non-banking financial institution that aims to provide adapted financial solutions to the education sector and especially to affordable schools in East Africa.

Context

In Kenya, the rapid urbanization combined with the rising income levels have increased the demand for private schools as the quality of public schools is wanting. In 2018, there were 52,000 registered and unregistered private schools in the country that focused on primary and secondary enrolments. Ed Partners currently lends to both affordable and middle-income schools, affordable schools being those with annual school fees below USD 300. By mid-2021, the company had disbursed a total of USD 1.5 mililon to over 140 schools.

The government has until now turned a blind eye to the existence of these schools, but has recently mandated that all schools with non-compliant infrastructure will be shut down. This is therefore incentivizing already registered schools to upgrade their infrastructure and for unregistered schools to start the registration process and to begin investing in compliant infrastructures. Therefore, most schools will require additional investment in equipment and basic infrastructure.

In this context, Ed Partners aims to fill the gap in the current market by providing customized products, understanding schools’ special needs and proposing tailored complimentary services to affordable schools in Kenya and in the long term in the region.

The model was conceived by replicating the proven business model of Varthana, a school financing company in India, with 7 years of experience and a current portfolio size of USD 157 million provided to over 3,500 schools.

The entrepreneurs

Ed Partners was founded by a team of 4 microfinance experts with on average 15+ years of experience in impact investing and in microfinance in East Africa and in India. Together, these founding members bring their expertise and network to support the roll-out of the project in the region.

Ed Partners is currently managed by Amos Mwangi who is the CEO. Amos has 17 years of experience in business development, sales, credit management and leadership. He previously worked 6 years as a Business Development Manager at Faulu Microfinance Bank in Kenya where he oversaw 44 branches in 38 locations. Before Faulu Microfinance, he worked at Equity Bank and Family Bank in various roles at both branch and head office level. Amos holds a Masters in Banking and Finance from Moi University and achieved complementary business and finance studies at Kenyatta University.

Partnership with I&P

The partnership between Ed Partners and I&P (through its fund I&P Afrique Entrepreneurs 2) aims to:

⇒ Ensuring a wider geographical coverage with the opening of 6 additional hubs in 6 counties in Kenya

⇒ Funding EdPartners’ loan book. The company anticipates a rapid growth of the loan book to reach 6,000 loans disbursed to about 3,000 schools in the next 5 years

⇒ Supporting further expansion into the rest of East Africa within the next few years, where there is significant demand for the products offered by Ed Partners

Expected Impacts

Ed Partners has the potential to have an important impact on the education sector in Kenya and in the long term in East Africa.

The company enables improvement in the quality of education offered by middle-income and affordable schools by providing access to adapted financial solutions and coaching.

XpressGas Limited is the fastest-growing and one of the largest LPG (Liquefied Petroleum Gas) companies in Ghana.

The company was incorporated in 2009 and was granted a license by the National Petroleum Authority in 2010 to operate as an LPG Marketing Company. XpressGas currently owns 3 LPG refill stations, 23 LPG Bulk Road Vehicles (BRV-Trucks), and serves a network of 53 third-party owned stations across all the regions of Ghana.

The main focus of the business is on the peri-urban and rural areas of the country, and this is in line with the Government of Ghana’s stated objective to increase access to LPG by 50% in 2030.

Liquefied Petroleum Gas (LPG) is increasingly becoming the preferred choice of fuel in the world and Ghana is moving in the same direction. The increase in patronage could be attributed to its affordability, efficiency and environmental friendliness. The impact potential of switching consumers from harmful traditional fuels such as firewood to LPG is significant.

The entrepreneur

The company is managed by a strong promoter who has built a well-structured business that has advanced up the ranks of the top LPG companies in Ghana within the span of just 8 years.

Mr. Kofi Nketsia-Tabiri brings over 18 years of investing, business development and entrepreneurship experience to the management of XpressGas. Prior to starting XpressGas, Mr Nketsia-Tabiri founded Patient Capital Partners, an energy project development and investment advisory firm that has undertaken several modern energy related projects for international organizations such as the World Bank, Triodos, African Development Bank, United Nations Environmental Programme, etc.

Kofi was the inaugural head of the business innovations unit in Africa at E+Co, the pioneering organization that funded over 250 clean energy investments in emerging markets before its restructuring in 2012. In 2017, Kofi was recruited as an Investment Consultant for the Africa Renewable Energy Scale Up Facility (ARESUF), under the auspices of Micro-Energy International and PROPARCO.

Partnership with IPAE 2

With support from I&P, XpressGas aims to:

•— Consolidate and cement its position in the B2B market

•— Accelerate the launch of the B2C cylinder recirculation model (CRM)

•— Improve health and safety standards

Expected Impacts

⇒— A company at the forefront in increasing LPG availability and access to consumers especially those in the rural areas who continue to suffer from Household Air Pollution (HAP)

Context: It is estimated that about 18% of households in Ghana use LPG as their primary source of cooking. The remaining 72% of households mostly depend on firewood and charcoal for cooking. Exposure to household air pollution is responsible for 16,600 deaths and the loss of 502,000 disability adjusted life-years annually.

⇒— LPG emits lower greenhouse gas emissions than alternatives, CO2 emissions are relatively low. Greenhouse gases are reduced by 5-16 times per prepared meal compared to coal.

⇒— Creation of over 300 direct and indirect jobs over the investment period with specialized training provided to staff

⇒— Contribution towards the development and structuring of the cylinder recirculation model in Ghana to create a safer environment for LPG distribution

Launched in 2017, StarNews is a network of mobile video channels that gives access to quality content thanks to strong distribution and marketing partnerships with pan-African mobile operators such as MTN, Orange and Moov.

StarNews is positioning itself in a unique market, specifically adapted to the African context to unlock the potential of the creation of mobile video content on the continent.

StarNews was designed as a digital platform for creating, producing and distributing video content to mobile subscribers on various themes (celebrities, culture, cuisine, sport, humor, religion, beauty, events, etc.). The company started out collaborating with local and international African celebrities such as Fally Ipupa, Serge Beynaud, Lady Ponce or Davido and has been focusing since 2019 on the development of new themes.

StarNews has established partnerships with large pan-African mobile operators such as MTN and Orange in order to distribute exclusive and quality video content directly to users who can subscribe through their mobile to the various channels offered.

The company now operates in Ivory Coast, Cameroon, the Democratic Republic of the Congo and South Africa

THE ENTREPRENEUR

Guy Kamgaing, founder and director of the company, has over 20 years of experience in the mobile phone industry.

This Cameroonian entrepreneur began his career some 20 years ago by supplying network equipment to cell phone operators. He then entered the service sector and was a pioneer of mobile navigation by SMS ( jokes, quizzes, horoscopes, etc...) in Africa, before the widespread use of smartphones and mobile internet. He observed then that value-added service offers are usually not Africanized and even when they are, the content comes only from international players.

He therefore decided in 2015 to work on the creation of a platform to deliver African content at an affordable price to consumers. He launched StarNews in 2017, and after only 9 months of pilot deployment in Côte d'Ivoire in partnership with the operators MTN and Moov, StarNews Mobile reached over one million subscribers.

PARTNERSHIP WITH I&P

StarNews carries out a first fundraising campaign with Investisseurs & Partenaires through its I&P Afrique Entrepreneurs 2 fund.

The partnership between StarNews and I&P aims to:

• Building the skills of local teams (Abidjan, Douala, Johannesburg, Lagos)

• Developing value-added content for users

"We are proud to support a talented and experienced African entrepreneur who demonstrates a real commitment to deploy a pan-African and innovative solution. We share StarNews’ ambition to showcase African artists and to produce a greater diversity of quality local content with high added value for end users"

Nouss Bih, Investment Manager at I&P, based in Abidjan, Ivory Coast.

EXPECTED IMPACTS

• Generating new sources of income for African artists and various creators of content

• Supporting the development of an information platform with increasingly impactful content (health, employment, etc.).

Founded in 2006 by the Malagasy promoter Malala Rabenoro, SOAFIARY is specialized in the sourcing, processing and commercialization of cereals (maize, rice) and leguminous plants (beans, cape peas, lentils, soybeans) on local and international markets. The company employs nearly 200 people, including 88% women.

Backed by a good reputation in this sector, the company begins to diversify its activities in 2017. SOAFIARY has set up a feed mill unit and has also launched the SOADIO project, a contract farming project run in collaboration with the diocese of the Vakinankaratra region, located in the highlands of Madagascar. The company trains the farmers and provides them with the agricultural equipment and inputs needed to operate the 4,100 hectares of land owned by the Diocese, and then buys the entire production. This project is a response to the challenges of traceability and product quality.

THE ENTREPRENEUR

The company was founded by Malala Rabenoro. With a background in marketing, Malala previously worked for an Microfinance Institution (MFI) where she gained more than 15 years of experience in administrative and personnel management. She left her position in 2011 to dedicate herself fully to SOAFIARY, where she manages the marketing, procurement and investor relations aspects of the business.

PARTNERSHIP WITH I&P

Soafiary is supported by the fund I&P Afrique Entrepreneurs 2 (IPAE 2). The partnership aims to:

⇒ Reviving the company's historical activity

⇒ Improving the quality management system

⇒ Supporting the company in the certification and standardization process (HACCP and Bio)

⇒ Developing the feed mill unit

⇒ Developing the SOADIO project

⇒ Strengthening corporate governance, Participating in management capacity building

⇒ Advising and supporting the company in its relations with investors and strategic third parties

EXPECTED IMPACTS

⇒ Promoting a committed female promoter

⇒ Creating jobs for a disadvantaged population with low education levels

⇒ Providing support to employees on literacy and hygiene-related issues

⇒ Supporting farmers through the SOADIO project

• Inclusion of small producers in the value chain
• Improving the living conditions of small producers

AGROSERV INDUSTRIE is an industrial unit processing maize into gritz and flour. Based in the industrial zone of Kossodo (Ouagadougou), the unit is equipped with two automatic production lines with a production capacity of 50 tons per day each.

The expertise developed by the promoter since the creation of the company in 2008 has allowed to him to conquer a significant portion of the national market.

In order to optimize the supply chain, AGROSERV INDUSTRIE decided to organize and support a network of small producers.

The entrepreneur

M. Siaka SANON holds a degree in IT Management. After graduating, he integrated the family business called EKSF (Establishment SANON Karidia et Fils), specialized in the collect and marking of cereals on local and international markets. This experience enabled him to get a full understanding of the maize supply chain. He managed the company for ten years and let its evolution towards AgroServ Industry, launched as a SARL in 2008.

Read the interview of Siaka Sanon (2022)

Partnership with I&P and Sinergi Burkina

Partnership with I&P and OikoCredit (2022 - now)

In 2022, Oikocredit and I&P (through its fund IPAE), with the support of BIO and EDFI AgriFI, completed the investment of €12.2 million in AgroServ Industrie.

This funding will allow Agroserv Industrie:

⇒ To build a new production unit in the city of Bobo-Dioulasso, which will increase Agroserv's processing capacity to 160 tons per day.

⇒ Agroserv also plans to diversify into higher value-added products, including high-energy flour, pre-cooked cornmeal and soy protein, which will be sold to households, the government for school canteens and the World Food Program.

⇒ Smallholder farmers supplying Agroserv are also expected to increase to 12,000 (from 6,000 today) through closer collaboration with local cooperatives, increased direct sourcing, and higher yields, thanks to technical assistance provided by I&P.

Read more about this new investment

Partnership with Sinergi Burkina (2017-2022)

AgroServ Industrie is the second investment of Sinergi Burkina, an impact fund sponsored by I&P and dedicated to small companies in Burkina Faso.

The collaboration between Agroserv Industrie and Sinergi Burkina had considerable impacts on the local economic fabric. It has notably allowed the strengthening of a network of some 6.000 small maize producers and the employees jobs' formalization. 

AgroServ Industrie is the first exit of Sinergi Burkina, after 5 years of successful collaboration.

Read more about the exit

In 2020, AgroServ also benefitted from financial support and technical assistance within the framework of the I&P Acceleration in the Sahel program, in partnership with the European Union. To cope with the unprecedented situation of covid-19, some fifteen companies benefit from technical and financial support to maintain their activities and overcome the crisis.

Main Impacts

• Structuring a network of more than 6,000 small maize producers

• Import substitution and sale of essential goods at affordable price

• Wages well above the legal minimum in Burkina Faso

About I&P Afrique Entrepreneurs 2 (IPAE 2)

IPAE 2 is an impact fund promoting the emergence of a new generation of responsible African entrepreneurs. IPAE 2 invests in equity and quasi-equity as a minority shareholder in startups and businesses located in Sub-Saharan Africa and the Indian Ocean, for amounts comprised between €300,000 and €5 million.

Read more

About Sinergi Burkina

Created in 2014, Sinergi Burkina is the first impact investment fund dedicated to financing and supporting SMEs and start-ups in Burkina Faso. Headed by Job Zongo, Sinergi Burkina is the second investment fund sponsored by Investisseurs & Partenaires as part of the I&P Développement 2 fund. The fund network currently includes a fund in Niger (Sinergi Niger), Côte d'Ivoire (Comoé Capital), Senegal (Teranga Capital) and Madagascar (Miarakap).  → To learn more about Sinergi Burkina