The African Private Capital Association (AVCA) is a non-profit organization that champions private capital investment in Africa. Established in 2003, AVCA has been committed to enabling and promoting private capital investment in Africa through advocacy, research, and networking.
The organization comprises over 170 members, including private equity and venture capital firms, institutional investors, foundations, and development finance institutions.
AVCA’s mission is to promote and enable private investment in Africa, unlock the potential of private capital, and drive economic growth and development on the continent.
The organization provides its members with a platform to connect, share knowledge, and collaborate to create value and impact. AVCA also conducts research on private capital investment in Africa, providing insights and analysis on trends, opportunities, and challenges in the sector.
AVCA’s flagship event is the Annual Conference and Venture Capital Summit, which is the largest Africa-focused private capital gathering globally.
The event brings together investors who collectively manage over US$1.5 trillion in assets to discuss and explore investment opportunities in Africa. Through its activities, AVCA has played a significant role in promoting private capital investment in Africa, helping to drive economic growth and development on the continent.
Overview of African Private Capital Association
The African Private Capital Association (AVCA) is an industry body that champions and enables private capital investment in Africa. It was founded in 2003 and is headquartered in London. AVCA is committed to unlocking the potential of private capital’s transformative role in building a prosperous Africa.
AVCA’s membership includes private equity and venture capital firms, institutional investors, and other industry professionals. Its members invest across a range of sectors, including healthcare, education, energy, and financial services.
AVCA provides a platform for its members to network, share knowledge, and collaborate on private capital deals in Africa. It also conducts research and publishes reports on private capital activity in Africa, such as the annual African Private Capital Activity Report.
AVCA’s work has contributed to the growth of private investment in Africa. According to AVCA’s 2022 African Private Capital Activity Report, Africa recorded a remarkable 46% YoY increase in deal volume and a modest 3% growth in deal value in 2022, despite the tough macroeconomic environment for investments globally. Private equity and venture capital firms were the biggest investors in Africa in 2022, accounting for 68% of the total deal value.
AVCA’s mission is to promote the benefits of private investment in Africa and to facilitate the growth of the private capital industry on the continent. Its work has helped to attract more private investment to Africa, creating jobs and driving economic growth in the region.
Key Activities and Roles
The African Private Capital Association (AVCA) plays a significant role as a champion and effective change agent for the private capital investment industry in Africa. The association connects members and key stakeholders with independent industry research, advocacy, best-practice professional development programmes, and unparalleled networking opportunities.
AVCA’s key activities and roles include:
Advocacy and Research
AVCA conducts and publishes original research on private capital activity in Africa, providing valuable insights into investment trends, opportunities, and challenges. The association also engages in advocacy efforts to promote policy and regulatory reforms that support the growth of the private capital industry in Africa.
Professional Development and Networking
AVCA offers a range of professional development programmes, including training, workshops, and seminars, to equip members with the skills and knowledge they need to succeed in the private capital industry. The association also hosts a variety of networking events, providing members with opportunities to connect with peers, potential partners, and portfolio companies.
Fundraising and Investment Activity
AVCA supports fundraising efforts by connecting fund managers with potential limited partners, including development finance institutions, endowments, and pension funds. The association also promotes investment activity by highlighting attractive investment opportunities and providing due diligence support to investors.
Impact and Innovation
AVCA is committed to promoting private capital investment that generates positive social and environmental impact. The association supports impact investing by providing resources and guidance to investors and entrepreneurs. AVCA also promotes innovation in the private capital industry, encouraging members to explore new investment models and strategies.
Deal Volume and Value
AVCA tracks private capital deal volume and value in Africa, providing regular updates and analysis on investment trends and activity. The association’s annual African Private Capital Activity Report is a valuable resource for investors, fund managers, and other stakeholders in the private capital industry.
Exits and Returns
AVCA tracks exits and returns in the private capital industry in Africa, providing insights into the performance of private equity funds and other investment vehicles. The association also provides guidance and support to fund managers and portfolio companies on exit strategies and maximizing returns.
Overall, AVCA’s key activities and roles are focused on connecting and supporting members and stakeholders in the private capital industry in Africa. The association is committed to promoting sustainable and impactful investment that generates positive social and economic outcomes for the continent.
Regional Focus and Influence
The African Private Capital Association (AVCA) has a strong regional focus and influence across the continent. With a membership base that spans across sub-Saharan Africa, AVCA is well-positioned to support private capital investment in key markets such as Nigeria, South Africa, Kenya, Ghana, and Uganda.
AVCA’s influence extends beyond just the major economies. The association has also been active in promoting private capital investment in emerging markets such as Niger, Senegal, and Rwanda. AVCA has also been involved in initiatives to support private capital investment in North Africa, particularly in Mauritius.
AVCA’s influence in the private capital industry is not limited to just supporting investment. The association has also been instrumental in promoting the use of best practices in the industry. AVCA has been involved in developing industry standards and guidelines, including the African Private Equity and Venture Capital Association’s (APEVCA) Code of Conduct. This code of conduct promotes ethical and responsible investment practices among private capital investors operating in Africa.
AVCA’s regional focus and influence are also reflected in the types of investments being made. The association has been active in supporting private capital investment in a range of sectors, including healthcare, mobile, and financial services. AVCA has also been involved in promoting investment in key industries such as agriculture and energy.
AVCA’s regional focus and influence are further evidenced by the involvement of prominent private capital firms such as Sahel Capital and Helios Investment Partners. These firms have been active in supporting AVCA’s initiatives and promoting private capital investment across the continent.
Overall, AVCA’s regional focus and influence are key factors in supporting private capital investment in Africa. By promoting best practices and supporting investment in key sectors and markets, AVCA is helping to unlock the potential of private capital to build a prosperous Africa.
Key Sectors and Industries
The African Private Capital Association (AVCA) champions private capital investment in Africa. AVCA plays a significant role as an effective change agent for the industry by educating, equipping and connecting members and key stakeholders with independent industry research, advocacy, best-practice professional development programmes, and unparalleled networking opportunities.
In aggregate in 2022, Financials accounted for US$2.4bn in private capital deployment in 180 deals, representing the largest shares of the industry’s total deal volume and value, 29% and 32%, respectively. The Financials sector was driven by an increase in Fintech investments, which is by far the largest and most well-funded sector in Nigeria, operating as a base for pan-African giants such as Flutterwave, Paystack, Interswitch, and Paga.
One factor contributing to private equity’s resilience in Africa is a focus on investing in businesses that provide “essential” or “emergency services,” including healthcare, food production, energy and education sectors, which continued to operate during lockdowns. This trend is likely to continue in 2021.
AVCA’s 2022 African Private Capital Activity Report highlights that the healthcare sector is one of the most attractive sectors for investment. The sector is expected to grow at a compound annual growth rate of 6.2% between 2020 and 2025. The report also notes that the energy sector is another promising area for investment, with the potential for significant growth in renewable energy.
Additionally, the report highlights that the education sector is a growing area for investment, particularly in the edtech sub-sector. The insurance and real estate sectors also offer attractive investment opportunities.
AVCA’s report also notes that the telecom and transport and logistics sectors are expected to experience significant growth in the coming years, driven by the increasing adoption of digital technologies and the growth of e-commerce.
In summary, AVCA’s report highlights that private equity investment opportunities in Africa are diverse and cover a wide range of sectors and industries. The financials sector, driven by fintech investments, is currently the largest and most well-funded sector in Nigeria. However, the healthcare, energy, education, insurance, real estate, telecom, and transport and logistics sectors also offer attractive investment opportunities.
Significant Events and Conferences
The African Private Capital Association (AVCA) hosts a wide range of events and conferences throughout the year, providing a platform for industry players to engage in meaningful dialogue, connect with peers, and exchange ideas. These events are designed to promote private capital investment in Africa and to facilitate the growth of the industry.
One of the most significant events hosted by AVCA is the Annual AVCA Conference and VC Summit, which is the largest Africa-focused private capital gathering globally. The conference attracts investors who collectively manage over US$1.5trn in assets. The conference features thought-provoking panels, roundtables, and breakout sessions about current trends and developments in Africa’s private capital industry. The conference also provides an opportunity for attendees to network with industry peers and to explore potential investment opportunities.
In addition to the Annual AVCA Conference, AVCA hosts a range of thematic summits, roundtables, briefings, capacity building programs, meetings, and networking receptions. These events cover a range of topics, including private equity, venture capital, impact investing, and ESG. AVCA also hosts events focused on specific regions, such as West Africa, East Africa, and Southern Africa.
AVCA’s events provide a platform for industry players to stay up-to-date with the latest developments in Africa’s private capital industry, to share best practices, and to explore potential investment opportunities. The events are attended by a diverse range of industry players, including fund managers, institutional investors, family offices, development finance institutions, and service providers.
Overall, AVCA’s events are an important part of the organization’s efforts to promote private capital investment in Africa and to facilitate the growth of the industry. By bringing together industry players from across the continent and around the world, AVCA’s events help to build relationships, foster collaboration, and drive investment in Africa’s private capital industry.
Impact of Covid-19 on African Private Capital
The Covid-19 pandemic has had a significant impact on the private capital industry in Africa. According to the African Private Equity and Venture Capital Association (AVCA), private equity deals in Africa remained constant at $0.7 billion in H1 2020, the same as in H1 2019. However, with the full impact of the pandemic on deal-making activity yet to be seen, it is likely that the industry will face challenges in the coming years.
The pandemic has affected the private capital industry in several ways. Firstly, it has led to a decrease in fundraising activity. In 2020, African private equity fundraising fell compared to the previous year due to the economic fallout of the pandemic. This was due to a reduction in investor appetite for African private equity, as well as difficulties in conducting due diligence and closing deals.
Secondly, the pandemic has led to a shift in investment focus. Investors are increasingly looking for opportunities in sectors that have proven to be more resilient to the pandemic, such as healthcare, technology, and logistics. This has led to a decrease in investments in sectors such as hospitality and tourism, which have been hit hard by the pandemic.
Thirdly, the pandemic has highlighted the importance of environmental, social, and governance (ESG) factors in the private capital industry. Investors are increasingly looking for opportunities that align with their ESG priorities, such as renewable energy and sustainable agriculture. This trend is likely to continue in the coming years, with ESG becoming an increasingly important consideration for investors.
Overall, the Covid-19 pandemic has had a significant impact on the private capital industry in Africa. While the industry has faced challenges in the short term, it is likely to recover in the long term as investors continue to seek out opportunities in the region.
Prominent Figures in the African Private Capital Association
The African Private Capital Association (AVCA) has been instrumental in promoting private capital investment in Africa. The association has a team of experienced professionals who have been working tirelessly to create a conducive environment for private capital investment in Africa. In this section, we will take a closer look at some of the prominent figures in the association.
CEO – Abi Mustapha-Maduakor
Abi Mustapha-Maduakor is the CEO of AVCA. She joined the association from MedAccess, a subsidiary of CDC Group, where she was Head of Business Operations and Finance. At AVCA, she is responsible for developing and implementing the association’s strategy, as well as managing its operations. Her experience in financial and risk management, strategy implementation, and organizational development makes her a valuable asset to the association.
Founder – Tomi Davies
Tomi Davies is one of the founders of AVCA. He is a seasoned entrepreneur and investor with over 30 years of experience in the technology and investment industries. He is also the co-founder of the Lagos Angel Network, which is one of the largest networks of angel investors in Africa. His experience and expertise have been invaluable in the growth and development of AVCA.
Chairperson – Ziad Oueslati
Ziad Oueslati is the current Chairperson of AVCA. He is also the co-founder and Managing Director of AfricInvest, a leading private equity firm in Africa. He has over 25 years of experience in private equity and has been instrumental in the growth and development of the industry in Africa. His leadership and guidance have been invaluable in shaping the direction of AVCA.
AVCA is fortunate to have such experienced and knowledgeable professionals leading the association. Their expertise and guidance have been instrumental in promoting private capital investment in Africa and creating a conducive environment for investors.
Noteworthy Investments and Exits
The African Private Capital Association (AVCA) has been tracking private capital activity in Africa for several years. In 2022, despite the tough macroeconomic environment for investments globally, Africa remained resilient and recorded a remarkable 46% YoY increase in deal volume and a modest 3% growth in deal value. The AVCA’s 2022 African Private Capital Activity report shows that private equity and venture capital funds invested in African businesses across a range of sectors, including healthcare, education, and consumer goods.
One of the noteworthy investments in 2022 was the $40 million trade finance loan provided by the African Development Bank to the Hibiscus Export Company Limited in Nigeria. The loan will enable the company to expand its operations and increase the export of hibiscus to Europe and Asia. This investment is a testament to the growing interest of private capital funds in trade finance in Africa.
Another noteworthy investment is the $10 million investment made by the African Agriculture Fund in Sourcing and Produce Limited, a Kenyan company that specializes in sourcing and exporting fresh produce to Europe. The investment will enable the company to expand its operations and increase its production capacity. This investment is a clear indication of the growing interest of private capital funds in the agriculture sector in Africa.
In 2023, AVCA’s African Private Capital Activity report showed that the private capital investment activity experienced a decrease of 15% in volume and 26% in value of deals due to a rapid slowdown of deal activity in the second half of the year as debt availability declined and economic uncertainty intensified. However, despite the challenging environment, there were still some noteworthy exits in the private capital space.
One of the noteworthy exits is the record high public offering of MTN Nigeria, which raised $6.5 billion in May 2023. The exit was the largest ever in Africa and was a significant achievement for the private equity and venture capital funds that had invested in the company. The exit is a clear indication of the growing maturity of the private capital industry in Africa.
Another noteworthy exit is the sale of a majority stake in a mobile money business by a private equity firm to a strategic investor. The deal, which was valued at $150 million, is a testament to the growing interest of private capital funds in mobile money in Africa. The exit is also an indication of the increasing number of strategic investors that are looking to invest in the African private capital space.
