RENEW, Global Affairs Canada launch investment acceleration project in Ethiopia 



RENEW announce the launch of a vital investment and business acceleration project in Ethiopia. The project, formally called Accelerating Business Growth (ABG), is made possible through the public-private partnership between RENEW and Global Affairs Canada (GAC).

ABG includes a number of strategic components including a national Investment Challenge, Finance Incubators and The Angel Investment Exchange (also referred to as “The Exchange”).  The Exchange will be the focal point of the project and the goal of the Investment Challenge. Within The Exchange, located in a San Francisco-style office space in Galani Cafe Warehouse will bring high potential companies, called small and medium enterprises (SMEs), through an intensive executive management-training program, help them connect with international investors and markets.

The goal is for businesses to scale into market leaders enabling them to play a stronger role in the Ethiopian economy. The Exchange aims to support 50 companies, which will be selected during the Investment Challenge, over the course of the next 5 years. The Exchange will focus on building financial management, environmental social and governance best practices, legal, operations and marketing strategies.

“Most companies in Ethiopia, even large companies agree that they would benefit from additional management disciplines to compete in the international market. After years of working with companies in Ethiopia and making our share of mistakes, we’ve found some of the secrets to success for companies. The Exchange will be the place where we work with companies to understand these secrets. For those willing to do the hard work, success is almost guaranteed,” says Matthew Davis, partner at RENEW.

These “secrets” will help companies transform into market leaders and ultimately lead to sustainable job creation for low-skilled workers, including women and young adults, through a dynamic and growing small and medium business sector in Ethiopia.

In June 2016, Global Affairs Canada (GAC) signed an agreement to partner with RENEW to extend its SME angel investment model across Ethiopia and support the Accelerating Business Growth (ABG) program for five years. The goal under this partnership is to increase the awareness and understanding of private equity investing in Ethiopia, increase the number of investments being made in Ethiopian SMEs by addressing the current financing gap, and create sustainable job growth.

RENEW is an experienced facilitator of an innovative investment model that brings the development community, the host government, foreign investors, and local companies together around a shared goal: to grow the private sector in African economies while creating lasting change for its communities through job creation and positive social impact.

RENEW’s public private- partnership model lowers the transaction costs which normally prevent foreign investments from flowing into SMEs in frontier markets. RENEW organizes and supports such medium- sized investments made by the Impact Angel Network (IAN), the largest North American-based impact angel network for Africa.

RENEW acts as the IAN’s in-country support team and provides consulting and investment services that span across all aspects of the investment process. RENEW’s model seeks to reduce the costs and risks foreign investors experience when investing in developing countries, and to increase the local awareness and strength of the business community in an effort to attract larger equity investments for its companies.

The type of financing RENEW and GAC are helping mobilize – broadly called impact investments – is growing as an investment class, offering investors opportunities to create sustainable social impact and financial returns through investments in companies that operate in high impact and fast growing countries such as Ethiopia. These trends, along with Ethiopia’s rapidly expanding private sector, could help position ABG to be a flagship project in the development sector.

RENEW and the ABG project’s investment strategy closely aligns with the goal and targets in the Ethiopian Government’s Growth and Transformation Plan II and the government’s overall desire to help Ethiopia industrialize and become a middle-income country by 2025.

The Impact Angel Network (IAN) is the largest North American-based angel network for Africa. RENEW is an impact investment firm working in Ethiopia and is undertaking the ABG project with the financial support of the Government of Canada provided through Global Affairs Canada. RENEW manages the IAN and provides professional investment advisory and consulting services in support of its investments.