I&P AFRIQUE ENTREPRENEURS FUND: COMBINE PERFORMANCE AND IMPACT LEGENI, I&P partner in Niger from 2003 to 2012
WHO ARE WE? Our History Founded in 2002, Investisseurs & Partenaires (I&P) s mission is to support growth s needs of a new generation of responsible African entrepreneurs and thereby contribute to the emergence of a sustainable and dynamic private sector in Sub-Saharan Africa. We believe that Small and Medium Enterprises (SMEs) are essential sector for growth and development in Africa, because they create jobs, value addition and also spur positive social, environmental and governance impacts. Over 11 years, I&P has invested more than 11 million euros in 30 companies out of which 7 microfinance institutions in 12 African countries. Our Organization Investisseurs & Partenaires family is made up of 2 financial vehicles: The financial company I&P Développement (IPDEV), The investment fund: I&P Afrique Entrepreneurs (IPAE) which is managed by I&P Gestion. The I&P family is located in Paris and in 5 African countries: Cameroon, Ivory Coast, Ghana, Madagascar and Senegal. It relies on circa 15 people who are experienced and committed to development. Our Philosophy Vision: We believe that Small and Medium Enterprises (SMEs) are key to growth and development in Africa, as they create jobs, value addition and also generate positive social, environmental and governance impacts. Mission: Build trustful long-term partnerships with African entrepreneurs while providing them with financial, strategic and operational support on one hand, and environmental, social and governance guidance/advice on the other. Values: Entrepreneurship/ Commitment to development/ Integrity/ Excellence 1
OUR MODEL: THE PARTNERSHIP WHEEL I&P is an active partner bringing its skills in management and finance in an entrepreneurial approach. Our model hinges entirely upon the entrepreneur, with whom we wish to establish a long-term relationship based on trust. Our investment in a business is three-fold: a) Financing: Through an equity investment, preferably as a minority shareholder, and operated through a capital increase on the basis of a mutually agreed valuation. Through participative and/or convertible loans whose remuneration is indexed on the company s results to avoid excessive financial costs during the early growth stage of the company. b) Mentoring: Before the investment, we conduct a thorough analysis of the strategy to be implemented especially in: sales, marketing, supply chain, etc. This study involves regular field visits, several meetings with the management, market research, financial analysis, etc. We also help put in place management tools (dashboards, budgeting, cost accounting ) developed in partnership with the entrepreneur in order to facilitate the steering of the company. During the investment period, we are actively involved in helping the implementation of this strategy by supporting the entrepreneur and management in the following areas: financial management, organization of the company, recruitment, product and service development, marketing and sales policies. c) Technical Assistance Raised from fund s investors and other organizations Used for capacity building and training in a variety of fields based on the investee business specific needs: MIS, industrial/technological, sales/marketing, organization/hr, training/governance, etc. OUR MODEL: THE PARTNERSHIP WHEEL 2
OUR IMPACT STRATEGY Being an Impact Investor, we are very aware of the impacts produced both internally and through our investees. Our impact strategy targets several domains: economic, financial, fiscal as well as ESG (Environmental, Social and Governance), through the creation of local added value, jobs Besides several of our company partners are involved in the structuring of local production and distribution chains, and thus the building of a strong and dynamic industrial base. Overall, I&P's investee companies employ permanently 1.400 people. In addition to this, the jobs created throughout the value chains-within supplier companies for example- should also be considered: La Laiterie du Berger works with 800 local dairy producers in Senegal; PhileoL, Castor oil producer in Madagascar, is supplied by nearly 6.000 local outgrowers; Biotropical, leader in organic agriculture in Cameroon collects its products from 50 to 200 local producers. I&P investees also provide innovative services to customers. They promote access to health, water and improve the environment or habitat for low income people. I&P AFRIQUE ENTREPRENEURS FUND S PRESENTATION The I&P AFRIQUE ENTREPRENEURS fund launched in 2012 and closed at 52.4 million euros is characterized by: A variety of investors: Private (Danone, CFAO, Bank of Africa, BRED, Crédit Coopératif, etc.), Public (EIB, FISEA-Proparco, FMO, AfDB) and Individuals. An investment period of 5 years (with a possible 1 year extension) A target of 50 investments Investments between EUR 300 000 and EUR 1 500 000 or equivalent in local currencies. Target areas: - West and Central Africa (from Senegal to DRC except Nigeria), Indian Ocean (Madagascar, Mauritius, Comoros Islands) - A secondary area could be considered: East Africa 3
INVESTMENT CRITERIA The companies targeted by IPAE should meet the following criteria: Growing medium-sized enterprises, Led by local entrepreneurs and management teams established in Africa, Operating within the formal economy, In a variety of sectors: health, agribusiness, agriculture, building, distribution, services, microfinance and any other licit sector, With a proven potential of value creation and positive social, environmental and governance impacts, Searching for a strategic partner, involved in the company s governance. INVESTMENT AND EXIT PROCESS The project s lifecycle follows 5 phases: A Shareholders Agreement signed before the investment between I&P and the company defines the rules of governance as well as I&P s exit terms. Indeed, I&P will sell its shares within the investment period of the fund once the company has reached a satisfying level of autonomy and performance. The exit terms are designed on a case-by-case basis and typically follow one of these scenarios: Management buy-out (entrepreneur(s) buy back the shares) Sell shares to a strategic partner, for example to another shareholder Sell shares to another investment company Together with entrepreneur sell the company to a group or to another company in the same sector. 4
PROFILES OF COMPANIES WHO PARTNERED WITH I&P o CAMED (Mali) In 1995, a Malian pharmacist started a generic drugs distributor with 5 000 with a moped. In 2003, I&P invested 50 000 in equity and also offered bridge loans to the company. After a few successful years, I&P sold part of its shares to other local pharmacists in 2007 and then the balance in 2012 to TEDIS, a French supplier of CAMED and an existing shareholder. I&P s partnership Formalization of the company and structuring of the financial management system Financial investment in storage facilities and vehicles Organisation of the marketing strategy and expansion of the products portfolio Fundraising from banks and the Belgian Cooperation (BIO) to finance inventories. CAMED impacts A formal company, well-structured and led by a skilled management team; Multiplication of the sales by 3, from EUR 1.2 million to EUR 3.3 millions in 2010 and very good profitability; Creation of a dozen of jobs; CAMED becomes n 3 on the market, local challenger to two French multinationals. o UGANDA FINANCE TRUST - Microfinance (Ouganda) Founded in 1984 by Ugandan women, UFT is one of the 4 biggest microfinance institutions in Uganda and has the largest presence in province. It is ruled by Uganda Central Bank as an institution authorized to collect savings, currently turning into a bank. UFT targets customers located in urban and peri-urban areas. I&P s partnership Since 2005, I&P is head of the operational committee coming from the board. Uganda Finance Trust impacts 414 employees in the institution. Access to credit services and savings for many: o 173,743 people save with UFT. o 22 700 borrowers in 2012 to finance their business. 5
o RICA SERVICES (Mali/Ivory Coast) Rica Services is a group specialized in the design, engineering, installation and maintenance of air conditioning systems and industrial refrigeration. The Group has two subsidiaries, in Mali and Ivory Coast. With his experience in Mali, Rica Services is deployed in Ivory Coast arguing that in 15 years the country has not invested and construction market is globally damaged. Approximately 80% of the towers of the city of Abidjan need renovation. I&P Partnership I&P is committed alongside RICA Services to: support the structuring of the company through the implementation of management control and cost accounting, and information systems; finance the start of activities in Ivory Coast and beyond the group's internationalization. Rica Services impacts Structuring the market of air conditioning and refrigeration in Ivory Coast; Creation of a dozen jobs in the new Ivorian subsidiary; The company is positioned on energy efficiency and deploys solutions to potential energy savings through its expertise and technological choices. o IOT (Madagascar) IOT is an enterprise of industrial aquaculture of sea cucumbers based in Madagascar. The cucumber aquaculture is carried out on the basis of a reproductive technology developed in Madagascar by a scientific team. IOT markets the sea cucumber products on an international basis. I&P Partnership I&P is committed alongside IOT to accompany the start-up in the organization of its information system. IOT impacts Creation and consolidation of 152 jobs over 6 years, out of which 77 are permanent ; Creation of a business providing revenue for a whole community of fishermen and their villages ; The cucumber acts as a sand cleaner, and feeds itself by filtering the sand/mud, it participates in the organic recycling and can be used as a fertilizer; The sea cucumber aquaculture is positive for the environment: no use of antibiotics, chemicals, no dispersion of food produced. 6
To find out more about I&P and its investees, please visit: www.ietp.com 7