RENEW’s Impact Angel Network (IAN), one of the most active equity investors in Ethiopia with an expanding presence in East Africa, have successfully exited two investments to a regional private equity fund and a family office.
RENEW and the IAN provided two rounds of angel financing to support the launch of an Ethiopian production company that exports to international markets. With the recent buyout of these positions, these investments realized gross internal rates of return (IRR) of 26.70% and 17.58%, respectively.
The IAN’s investments helped a start-up company become a leader in its industry in Ethiopia. The company has received international awards and certifications on account of a superior product and exceptional processes.
It now purchases from thousands of smallholder farmers and employs hundreds of Ethiopians in permanent and temporary positions.
The company’s success can be attributed to the strong leadership and disciplined management of a visionary entrepreneur and committed contributor to the well-being of the communities in which he operates.
“At RENEW,” says CEO Matt Davis, “we aim to back companies with strong leadership and good market position or potential. The companies we invest in are often overlooked due to their size as SMEs and their location in countries in East Africa that are promising but not yet seeing significant inflows of capital. We cannot expect all investments to follow the trajectory of the two exits we are announcing. Today, though, I celebrate these wins for the IAN, for Ethiopia and for SMEs providing good jobs to a lot of people.”
This project targets sustainable job creation for low-skilled workers, including women and young adults, through a dynamic and growing small and medium business sector in Ethiopia.
Ethiopia has been expanding its prospects in attracting foreign Direct Investments (FDI) following several reforms that are being implemented by the government of Prime Minister Mohamed Abiy.
Foreign direct investment has increased by more than 10%, as the global business community recognizes the potential being unlocked by political as well as economic reforms. Ethiopia has improved the rule of law by, among other things, revisiting the laws themselves, including the Anti-terrorism Proclamation and the Civil Society Organizations law.