Increasing access to sources of impact investment finance for growth-oriented businesses
Access to finance is the most common challenge faced by Zambian SMEs. Traditional commercial bank finance and microfinance is expensive and difficult to access due to stringent requirements and inappropriate loan terms and conditions.
In addition to traditional finance, impact investment is an alternative financing option for growth-oriented Businesses. Zambia’s impact investment ecosystem is relatively small when compared to other African countries such as South Africa, Kenya and Nigeria. Despite impact investment funds being available for deployment to Zambia, only a fraction is ever invested due to the disconnect between impact investors and Zambian businesses.
In addition, SMEs are generally not investment ready because they lack an understanding of investor requirements, and investors don’t have enough information about Zambian SMEs.
Through intervention partnerships, Prospero aims to address the following sector-wide constraints:
The Prospero Investment Services sector is comprised of four initiatives:
To identify a pipeline of growth-stage, impact SMEs, get them investment ready and link them to impact investors with the express aim of signing investment deals.
To strengthen the capacity of local fund management firms to improve their fundraising capabilities and increase their investment into locally viable businesses.
To build a pipeline of SMEs that will eventually graduate towards growth-stage investments. We will establish an angel investment network in partnership with the African Business Angel Network, MentorMe and BongoHive to provide investment and mentorship for early-stage businesses. The establishment of this network will serve as a blueprint for the establishment of future angel networks in the country.
National Advisory Board for Impact Investment
To continue our partnership with the Zambia National Advisory Board (NAB) for Impact Investment to accelerate the growth and effectiveness of impact investing in Zambia.
Prospero increases access to capital for growth-oriented businesses by building a healthy impact investment ecosystem. We work in collaboration with both internal and external stakeholders to develop the entire impact investment ecosystem as well as explore alternative financing for companies.
We partner with growth-oriented businesses in sectors targeted by impact investors through a coordinated approach that will see these businesses transition from grant support to growth-stage investment.
Partner With Us
To achieve the specific objectives of each initiative, Prospero seeks intervention partners that include, but are not limited to:
International cooperation agencies • SME growth programmes • Private equity managers • Venture funds • SME advisory service providers • Government agencies