By women, for women: Alitheia moves the needle on gender-lens investing in Africa

## Women entrepreneurs in Africa, long confined to a small wedge of the venture capital funding pie, can now plug into a pipeline of female-conscious equity funds to build their businesses as gender-smart investing gains traction in Africa.

by Seth Onyango, bird

African women have begun pushing their way into the ranks of venture capital executives and creating funding opportunities for female-run startups.

Last week, Alitheia IDF (AIF), a women-focused private equity fund, racked up 100 million US dollars to become the largest gender-lens fund by value in Africa.

The development highlights the growth potential for women-run businesses on the continent. Until recently these businesses faced hurdles accessing the capital needed to catalyse growth.

Alitheia is the continent's first gender-sensitive fund of its kind and proactively invests in a diversified portfolio of women-owned, women-led, or women-serving companies.

Founded in 2007 by Tokunboh Ishmael and Jumoke Akinwunmi, Alitheia puts its money behind African women's entrepreneurial acumen.

“One of the first drivers was when I realised that much of the capital that I was deploying was going to male founders and male-run businesses in male-dominated industries,” Ishmael said.

“I sat in rooms where I was the only woman investor, surrounded by male-founded investee companies, and I thought, ‘That cannot be because female founders do not exist’. So I dug and found that the numbers played to the fact that diversity does drive superior performance, better corporate governance, greater innovation.”

According to the European Investment Bank (EIB), about 40 per cent of businesses in Africa are women-owned, but less than 10 per cent of them can raise funding from traditional financiers.

This year, women-only founders received a paltry 1 per cent of the over 4 billion US dollars raised by startups.

“Globally, women have tremendous purchasing power as consumers and controllers of household economics. In the same vein, women entrepreneurs have a significant presence in Africa’s SME sector with African women making up 58 per cent of the continent’s self-employed population. However, despite this economic power and presence, they are underserved as consumers and producers,” Ishmael said.

Alitheia only invests in growth-stage companies in Nigeria, South Africa, Ghana, Zimbabwe, Lesotho and Zambia, leaving out 50 states.

Nonetheless, its presence in key markets such as South Africa and Nigeria gives impetus to the growth of gender-lens equity funds across the continent.

The growth of such funds will be crucial in helping women-owned businesses recover from the COVID-19 pandemic.

According to the International Finance Corporation (IFC), women were disproportionately affected by the economic fallout from COVID-19.

IFC figures show over 90 per cent of MSMEs across sub-Saharan Africa suffered considerable economic impact due to the COVID-19 pandemic.

"Women-led MSMEs have been especially hard hit, with many reporting revenue losses of over 50 per cent, largely due to their smaller size, informality, and concentration in heavily affected sectors," the IFC said.

New initiatives to support women-owned and led businesses included the launch of the African Women Leadership Fund (AWLF), with millions of dollars raised to provide capital to fund managers in support of gender equality, decent work and the African Union "Agenda 2063" - a blueprint and master plan for transforming Africa into a global powerhouse.

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