A fund offering private debt finance to growing African businesses has announced a final close at $156 million. BluePeak Private Capital Fund SCSp is an alternative asset manager supporting the growth of scalable businesses in Africa through privately negotiated flexible capital solutions, similar to and including debt, to entrepreneurs.
Latest investors are African Development Bank (AfDB) and South African private investor Sango Capital, They join other backers for BluePeak: British International Investment (BII, the UK’s development finance institution), European Investment Bank (EIB), US Development Finance Corporation (DFC), FMO (the Dutch entrepreneurial investment bank), SwedFund (Sweden’s development finance institution), and “Caisse des Dépôts et Consignations” (CDC) Tunisia.
In the 3 years since the fund’s first close, it has built a diversified portfolio of 6 pioneering businesses operating in more than 30 countries across Africa, employing over 7,500 people and impacting the lives of millions. BluePeak was set up in 2019 and has presence in Tunis, Nairobi and London. It proactively identifies areas where positive impact can be achieved and believes that environmental, social and governance (ESG) factors positively contribute to investment performance, as well as to help build a more stable, sustainable business and inclusive global economy.
According to a press release “The closing signifies the emergence of private debt as an attractive asset class, offering superior risk adjusted and a compelling alternative for African SMEs. The rapid deployment of conscious capital in several industries demonstrates the range of growth opportunities available in the region.”
Walid Cherif, BluePeak Co-Founder and Managing Partner said: “We are excited about the next phase, partnering with ambitious entrepreneurs to boost operational excellence, drive growth, strengthen ESG practices and unlock positive impact across Africa.”
BluePeak works closely with its partners to encourage growth, employment, and opportunities to balance gender equality. The fund is committed to the 2X Challenge initiative, a flagship initiative under 2X Global, first launched at the G7 Summit 2018 as a joint commitment by the Development Finance Institutions (DFIs), with a target of $3billion over 3 years, and with a more ambitious target at the G7 Summit 2021 to invest $15bn in private sector investments that provide women with improved access to leadership opportunities, quality employment, finance, enterprise support, and products and services that enhance economic participation and access. Both targets were overachieved and total invsetments under the 2X Challenge are $27.7bn.
A 2017 report from the International Finance Corporation estimates the SME “finance gap” at $245bn in sub-Saharan African and $138bn for the Middle East and North Africa. The AfDB says the gap for SME finance is estimated as $421bn in Africa. (Paper International Finance Corporation (2017): MSME Finance Gap, World Bank Group, Washington D.C. accessible here; AfDB paper 2021 African SMES Through COVID-19 Challenges, Policy Responses and Recommendation available here).