Impact investment firm collaborates with Kenya Investment Mechanism to finance agribusinesses

KENYAVital Capital, an impact investment firm has collaborated with the US Government’s Kenya Investment Mechanism (KIM) to unlock significant financing to businesses in targeted sectors that have been adversely affected by the COVID-19 pandemic.

Managed by Palladium, an international impact advisory and management firm, KIM aims to unlock US$400 million in investments for key sectors of Kenya’s economy, including agriculture, regional trade and investment opportunities.

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Palladium is a global leader in the design, development, and delivery of Positive Impact — the intentional creation of enduring social and economic value.

Palladium works with foundations, investors, governments, corporations, communities and civil society to formulate strategies and implement solutions that generate lasting social, environmental and financial benefits

By unlocking finance to agribusinesses and other sectors, KIM will pull small and medium sized enterprises (SMEs) into competitive and growth-oriented value chains to foster broad-based, sustained, and inclusive economic growth in Kenya.

“We are excited to launch this major collaboration to support Kenyan agribusinesses in what is an incredibly challenging economic environment,” said Nimrod Gerber, Managing Partner, Vital Capital.

“KIM’s goals are closely aligned with our own and we have a shared vision for the economic development of the agricultural sector in Kenya. We believe this collaboration has the potential to effect real change and support smallholder farmers survive the worst ravages of the COVID-related economic crisis.”

Under the agreement, Vital Capital and KIM will collaborate to identify potential opportunities in KIM’s pipeline that corresponds to Vital Capital’s investment mandate and to leverage KIM’s network of transaction advisors to more efficiently bring transactions to close under Vital Capital’s investment committee.

“This collaboration with KIM is a significant validation of our approach and we look forward to working closely together to identify new opportunities and unearth companies providing essential services to communities in Kenya to preserve their impact and employment,” said Guido Boysen, Co-Lead of the Vital Impact Relief Facility

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The Feed the Future Kenya Investment Mechanism (KIM) is a five-year (2018–2023) U.S. Agency for International Development (USAID) program supported by Feed the Future and Prosper Africa.

KIM addresses constraints on both the supply and demand sides of investment transactions and is building a market system that will mobilize substantial capital from the public and private sectors.

Vital Capital and KIM are seeking to identify and execute at least five completed transactions, providing at least US$5 million in financing, to alleviate the strain of COVID-19 on impactful Kenyan businesses, sustaining 500 jobs.

The collaboration follows Vital’s launch in April of the Vital Impact Relief Facility, a US$10 million emergency loan facility to offer critical funding to promising African businesses to help them overcome the economic consequences of the COVID-19 pandemic.

“Vital Capital was quick to recognize and fast to respond to the economic consequences of COVID-19 in Kenya, and we are pleased to collaborate with them,” said Roger Bird, Kenya Investment Mechanism Chief of Party.

“As a long-standing investor in the region and, in addition to bringing new funding and a pipeline of investment opportunities in our target sectors, the Vital team bring a huge amount of experience and expertise of creating positive sustainable impact that will be invaluable as we look to create enduring economic growth in the country.”

Founded in 2011, Vital Capital is a leading impact investment, private equity fund that is focused on sub-Saharan Africa and aims to benefit millions of people in low and middle-income communities.

Vital’s investments are guided by the conviction that creating positive, sustainable impact goes hand-in-hand with delivering market-rate, risk-adjusted returns for its investors.

The Vital Impact Relief Facility (VIRF) is a US$10 million emergency debt facility aimed at offering critical funding to promising African businesses to help them overcome the economic consequences of the COVID-19 pandemic.

Feed the Future is the U.S. Government’s global hunger and food security initiative. With a focus on smallholder farmers, particularly women and youth, Feed the Future supports partner countries in developing their agriculture sectors to spur economic growth and trade that increases incomes and reduces hunger, poverty, and malnutrition.

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