Financing Growth Panel
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Transcript of Financing Growth Panel
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Financing Growth
Funding options and availability of investment
Attractive positioning for successful round
PanelJohn Foster, Africa Editor, DebtWire – The Mergermarket Group
Folabi Esan, Partner, Adlevo CapitalIrungu Nyakera, M.D., Equity Investment Bank Limited
ModeratorAlon Avnon, M.D., BizDevOS
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On the stage
John Foster, Africa Editor, DebtWire – The Mergermarket GroupJohn Foster oversees the Africa Debt Capital Markets desk for Debtwire’s CEEMEA practice. Debtwire is part of the Mergermarket Group, based in London and New York. John and his team produce all the African DCM content for Debtwire, covering both loans and bonds and sovereign and corporate issues continent-wide. He reports and tracks the primary bond issues of African-domiciled companies.
Folabi Esan, Partner, Adlevo Capital www.adlevocapital.comFolabi Esan has been a partner at Adlevo Capital since it was founded in 2007. Alvedo makes equity and equity-linked investments in rapidly growing private companies in various stages of development. These companies derive their competitive advantage from the development and exploitation of technology or technology-driven processes.
Alon Avnon, M.D., BizDevOS Ltd. www.bizdevos.comAlon is the founder and Managing Director of BizDevOS Ltd. London based advisory firm, focus on the financial aspect of business development. BizDevOs offer companies and investors support with critical challenges, such as planning and executing synergetic acquisitions, strategy and execution of efficient capital raising, due diligence and others.
Irungu Nyakera, M.D., Equity Investment Bank LimitedServed as Regional Director, East and Southern Africa at Frontier Markets Fund Managers, uarantCo, and as a transactor at Citigroup in London. Was also the Managing Director at NIC Capital.
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Five Common Myths
There is not enough money for investment in Africa
Investors do not have the appetite for the level of risk in Africa
The project / venture is too big / small, too early / too mature, or not in the right space
Regulatory and legal framework ecosystem does not enable certain forms of finance
International investors are very picky
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Five Common Myths
There is not enough money for investment in Africa
Investors do not have the appetite for the level of risk in Africa
The project / venture is too big / small, too early / too mature, or not in the right space
Regulatory and legal framework ecosystem does not enable certain forms of finance
International investors are very picky
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Foreign Direct Investment (FDI)
Mixed picture for the Continent.Sub-Saharan Africa’s FDI is
growing strong
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Other Investment Channels
Strong investment growth across all non-governmental sources
African Public Offerings in London“…there are more than 100 companies listed in London…”“…10 African countries listed on LSE in 2013, double 2012’s...”“… From 2008 to 2012 African companies raised $6.9Bn…”
Baker & McKinzie“… we’ll continue a strong IPO market as investor appetite to African equities just keep growing…” Goldman-Sachs
CAGR: 49%
CAGR: 10%
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Five Common Myths
There is not enough money for investment in Africa
Investors do not have the appetite for the level of risk in Africa
The project / venture is too big / small, too early / too mature, or not in the right space
Regulatory and legal framework ecosystem does not enable certain forms of finance
International investors are very picky
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Perceptions is everything…..
Experienced African investors view investment in Africa significantly more
positive than others
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Perceptions tend to (eventually) converge with reality
Key Ecosystem indicators are in the same range as the BRICs
Rwanda 32South Africa 41
Ghana 67Zambia 83
Russia 92China 96Brazil 116
Ethiopia 125Kenya 129
Uganda 132India 134Mozambique 139Tanzania 145Nigeria 147
Côte d'Ivoire 167Cameroon 168
Senegal 178Angola 179
Ease of Doing Business Ranking
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Five Common Myths
There is not enough money for investment in Africa
Investors do not have the appetite for the level of risk in Africa
The project / venture is too big / small, too early / too mature, or not in the right space
Regulatory and legal framework ecosystem does not enable certain forms of finance
International investors are very picky
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Not in the right space or geography
Africa is not about minerals only and not only South-
Africa any longerSource: The Search for Returns
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Investment pattern
The African private equity investment model is catching up with practices in
the developed world
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Five Common Myths
There is not enough money for investment in Africa
Investors do not have the appetite for the level of risk in Africa
The project / venture is too big / small, too early / too mature, or not in the right space
Regulatory and legal framework ecosystem does not enable certain forms of finance
International investors are very picky
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Raising money from the public…..
IPO is a limited route to raise fund or exit, but not impossible.As the economy grows and volume increases, public listing will become
accessible to more companies.
African Public Offerings in London“…there are more than 100 companies listed in London…”“…10 African countries listed on LSE in 2013, double 2012’s...”“… From 2008 to 2012 African companies raised $6.9Bn…”
Baker & McKenzie
“… we’ll continue a strong IPO market as investor appetite to African equities just keep growing…”
Goldman-Sachs
Source: RisCura, ASEA
Number
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The oldest form of finance….
Although debt is available to African enterprises, it is not being used to the
same extent as in other countries.An Opportunity?
$0-25M $25-50M $50-100M >$100M
African Debt %
African Equity %
Global
Debt %
Source: RisCura, Pitchbook
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Five Common Myths
There is not enough money for investment in Africa
Investors do not have the appetite for the level of risk in Africa
The project / venture is too big / small, too early / too mature, or not in the right space
Regulatory and legal framework ecosystem does not enable certain forms of finance
International investors are very picky
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Yes!!! Investors are very picky…
But,Africa’s risk adjusted multipliers
are sensible
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Investors deserve the credit for….
Picking the right space and the right location