Aruwa Capital Management, a Lagos-based female-founded and led early-stage growth equity and gender lens investment fund, has announced the successful close of its first institutional fund, which was oversubscribed, surpassing its target of $20 million.
The fund’s first institutional and anchor investor is Visa Foundation, followed by other investors such as Mastercard Foundation Africa Growth Fund, Nyala Venture, backed by Financial Sector Deepening Africa Investments and leading family businesses from Africa, Europe and the United States.
Aruwa Capital Management was founded in 2019 by Adesuwa Okunbo Rhodes who has leveraged more than a decade of investment banking and private equity experience from leading global organisations such as J.P. Morgan.
Adesuwa started Aruwa to address the investment gap that women-led enterprises face in Africa. They comprise 40% of all small and medium enterprises (SMEs) yet receive only 1% of startup capital due to the lack of female capital allocators in the region.
Through its investment strategy, the Fund aims to create more sustainable and scalable pathways for economic growth and inclusion in the region. The Fund will invest $500 thousand to $2.5 million in women-focused small and growing businesses in Nigeria and Ghana, targeting investments in critical sectors such as healthcare, fintech, renewable energy, and essential consumer goods.
Aruwa invests in innovative businesses, poised for scale, that provide essential goods and services to the rapidly expanding female economy, and businesses that are founded or led by women or have gender-diverse teams.
To date, the Fund has made six investments, committing over 45% of its capital into a diversified portfolio of rapidly growing companies. Aruwa has established a reputation for rigorous investment selection and active hands-on support of management teams on the ground, to improve Company operations and performance. Aruwa’s team is comprised of investment professionals and portfolio managers, based in Lagos, who combine international best practice skill sets from global institutions with deep local networks, and on-the-ground presence to unlock untapped investment opportunities.
Najada Kumbuli, Head of Investments at Visa Foundation, said: “Visa Foundation is pleased to be the first institutional investor in Aruwa Capital Management. We deeply believe that in order to address the financing gap that women-led small businesses face, we need to empower and invest in more women-led investment funds like Aruwa. We were impressed by Adesuwa’s track record and her approach to tailoring the Fund’s financing to small businesses needs. We believe the team’s deep commitment to driving equitable and inclusive economic growth through investments will meaningfully support the business owners and the communities they operate in.”
Samuel Akyianu, Chief of Party at the Mastercard Foundation Africa Growth Fund (MFAGF) said: “We selected Aruwa Capital as one of our first investments because we were impressed by the team’s grit, conviction and depth of analysis, their value addition for early-growth stage SMEs in Nigeria, and their commitment to driving impact for women and youth. We look forward to working with the team to help make Aruwa Capital a success story.”
Bart Schaap, Managing Director at Nyala Venture said: “With our investment, we are putting our weight behind local and innovative capital providers in Sub-Saharan Africa with a focus on gender lens. The Aruwa Capital team has already made successful investments in small and growing businesses in West Africa that are creating inclusive economic growth and jobs whilst also strengthening good corporate governance and investment rigour in the process.”
Adesuwa Okunbo Rhodes, Founder of Aruwa Capital Management, said: “Having launched the Fund in October 2019 shortly before the COVID-19 pandemic, we are very grateful for the confidence of world-class institutional investors who have put their trust in us and share our vision for the continent: generating superior returns, whilst having a significant socio-economic development impact in the countries we invest in.
“We are also delighted to have been able to mobilise 30% of our Fund from local investors, who have a first-hand understanding of the operating terrain, as well as mobilising global capital from well-respected names, a trend we hope to see continue.
“We are excited to continue to showcase the untapped potential of women in society through our investment portfolio at Aruwa Capital. Global data has shown that investing with a gender lens improves financial returns as well as providing a multiplier effect for social impact in local communities due to the role women play, we look forward to showcasing this in Africa specifically.”
