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XSML Capital, a renowned provider of growth capital to small and medium-sized enterprises (SMEs) in Central and Eastern Africa, has announced the introduction of its fourth fund, named the African Rivers Fund IV (ARF IV). The inaugural closure for this fund has yielded an impressive total of $98.7 million.
Mission and Background: Established in 2008, XSML Capital is committed to assisting ambitious entrepreneurs in Africa’s frontier markets. With a focus on transforming these businesses into sustainable mid-to-large scale enterprises, the firm offers extensive expertise, a vast network, and tailored financial solutions. This effort aims to foster local talent and stimulate long-term prosperity in the underutilized markets of Central and East Africa.
Financial Support for SMEs: ARF IV succeeds ARF III, which has now been fully invested. The African Rivers Funds target the financial nurturing of promising small and medium-sized enterprises, particularly in Central and East Africa. These businesses often struggle to access funding from traditional banking sectors and other financial institutions, placing them in an overlooked ‘missing middle’ segment.
Expansion and Investment Strategy: With the recent funding secured, XSML Capital is poised to double its investment volume and impact in the coming years. The company also plans to explore new markets for investment opportunities, such as Zambia.
Investor Confidence and Partnerships: Notably, existing investors from previous funds have demonstrated renewed confidence in XSML’s approach by reinvesting and even increasing their commitment. This has attracted new investors to join the ranks, reflecting the growing support for XSML’s mission.
Achievements and Outlook: Barthout van Slingelandt, Managing Partner of XSML Capital, expressed satisfaction with the successful inaugural closure of ARF IV. He acknowledged the challenges of raising funds, particularly within Africa, but emphasized the overwhelming response and financial support that exceeded the firm’s previous fund size. This achievement underscores investors’ confidence in XSML’s investment strategy and performance. Slingelandt further highlighted the shared enthusiasm for investing in driven entrepreneurs in Africa’s untapped frontier markets.
XSML Capital’s launch of the African Rivers Fund IV signifies a significant step towards boosting SME growth and fostering economic development in Central and Eastern Africa.
Source: Innovation Village