NAIROBI, Kenya- Unconventional Capital (Uncap) has introduced a Ksh 4.3 billion fund aimed at providing revenue-based, non-dilutive financing for early-stage small and medium-sized enterprises (SMEs) across Africa.
This initiative aims to bridge the funding gap for businesses in critical growth sectors, offering a more flexible financial solution tailored to the challenges faced by African SMEs.
Uncap’s Managing Partner, Esther Ndeti, emphasized the fund’s mission to reshape SME financing on the continent.
By providing businesses with the resources they need to thrive, the fund hopes to contribute significantly to sustainable economic growth.
“SMEs account for about 90pc of African businesses, yet they face many challenges in raising capital,” Ndeti noted. “The inefficiency of African capital markets in effectively supporting SMEs, coupled with limited visibility to a broad investor base, continues to hinder access to essential funding.”
The fund specifically targets high-potential businesses in sectors like agriculture, trade, logistics, climate resilience, and financial inclusion.
These industries are considered critical for driving economic growth and fostering resilience in underserved markets.
In an effort to maximize its impact, Uncap will collaborate with key partners. These include the SAIS ag-tech initiative, funded by the German Federal Ministry for Economic Cooperation & Development (BMZ) and implemented by GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH), as well as O-Farms, a circular agriculture program backed by the Ikea Foundation.
These partnerships will help streamline support for SMEs in areas that need it the most.
Additionally, Uncap has separated its financial operations from its proprietary technology platform, Level.
This stand-alone SaaS platform simplifies investment management for funders and accelerators throughout Africa. By doing so, Uncap can better focus on delivering tailored financial solutions while expanding its tech-driven investment support services.
With support from global institutions such as the Bill & Melinda Gates Foundation and the Bayer Foundation, Uncap’s new fund is poised to address capital gaps that often hinder early-stage SMEs from scaling.
Over the past three years, Uncap has been at the forefront of innovative, alternative financing for African businesses, and this fund represents the next phase of that commitment.
“We hope this fund will address capital gaps for early-stage SMEs as they scale, deepening our impact. In the end, we want to not only support more businesses but also set new standards in the industry for innovation and inclusion,” Ndeti added.
This new funding model is expected to set a precedent for sustainable, inclusive financing that empowers African entrepreneurs and fosters economic growth.
