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Private Equity Sub-saharan Africa FISEAPROPARCOBoosting African SMEsProject start: 2009Financing: Equity investment of $10M with technical assistancePartner : GroFin ManagerImpactsThe impact on thedevelopment is very high.According to GroFinforecasts, more than 13 000jobs should be created orconserved thanks to theinvestments of GroFin AfricaFund. Around 92 000 peopleshould benefit from it(through the creation ofindirect jobs).ContextGroFin is a multi-national specialist SME finance and developmentcompany offering an innovative combination of risk capital andbusiness development assistance to viable enterprises.The Growth Finance sector is a niche market providing risk finance forsmall and medium businesses in emerging markets, focusing on theability of the business to make a profit year after year. Entrepreneurs inthis sector are often unable to access finance from traditional financeinstitutions as they lack the necessary track record or collateral.Microfinance, although flexible and development orientated, isrestricted to supporting individuals and small entities. Private Equityoffers management input and long term involvement, but is confinedto assisting larger, more mature companies. Venture Capital offers theseed funding so desperately needed by start-up businesses lacking atrack record, but is confined to early stage, high growth businesses.GroFin, as a leading supplier in the Growth Finance sector, offers asolution which integrates flexible finance with business support,serving entrepreneur-owned businesses. GroFin has established itselfas one of the leaders in the market by raising five funds dedicated toSMEs between 2004 and 2007.GroFin Africa Fund, the 6th fund managed by GroFin’s team, is amezzanine fund of $170M and is the biggest multi-countries fundraised by the group, with a presence in seven countries in sub-SaharanAfrica: South Africa, Uganda, Tanzania, Kenya, Nigeria, Ghana andRwanda. It is also the largest fund targeting the Growth Finance sector.Project objectiveFISEA’s equity investment in GroFin Africa Fund aims at taking part inthe development of the private sector and the strengthening of SMEsin sub-Saharan Africa. Beyond its equity contribution, FISEA’sintervention through technical assistance aims at improving thestandardization and performance of GroFin’s financial offering inseveral countries throughout sub-Saharan Africa. FISEA’s contributionaims to provide financing and operational support to the“intermediary marginalized sector” of African SMEs in order to create avirtuous circle benefiting local economies.

Private Equity Sub-saharan Africa FISEAPROPARCOProject descriptionThe financing offer provided by GroFin materializes in a financialpackage -mezzanine loans (average amount of $350 000),performance based incentives, with technical support- tailored toeach entrepreneurs’ needs and cash flow’ risk profiles. Thestandardization of tools and methods enables the organization toreach a scale effect that could be comparable to that of the bankingnetwork.Andrew Sibeko, Engen Maraisburg(bakery business)“GroFin’s hands-on personal approach is so refreshing after having worked with a bank before. Theirguidance in finalising my business plan and helping me address the risks made the start-up moresuccessful and I now benefit from their assistance to help me grow the business. Having them supportme financially and making their expertise available to grow my own management skills is a big part ofmy business success.”More information on www.proparco.frhttp://fisea.proparco.com