Averroès Africa: a fund of funds to promote the development of the private equity industry in Africa

Proparco and Bpifrance launched the Averroès mechanism in 2003 to support the development of the private equity market, firstly in North Africa then across the continent with the launch of a first pan-African vehicle (Averroès Finance III) in 2015.

This pioneering fund of funds mechanism has channeled some EUR 1.2bn into about 20 private equity funds and over 150 companies in 40 African countries. Proparco and Bpifrance have continued their partnership by launching Averroès Africa, a new vehicle which, like its predecessors, is open to subscriptions by third-party investors (public and private, French and foreign). They will complete the financing round of the first closing (for EUR 55m) in order to reach the target size of EUR 100m. 

Averroès Africa has the same investment thesis as Averroès Finance III, by targeting multisectoral private equity funds with a multi-country, regional or pan-African dimension and managed by experienced teams. Averroès Africa has an increased focus on venture capital funds and, for the first time, can invest in sectoral funds for financial services, health and agribusiness, in line with developments on the African market. With a target portfolio of 10 to 12 funds, Averroès Africa will eventually provide exposure to over 100 African companies (from start-ups to midcaps) in all the main sectors related to the emergence of the middle class in Africa, such as consumer goods, transport and logistics, industry, education and TMTs. 

The balance sheets of the funds working in Africa underlying the predecessor Averroès funds suggest that this operation will have potentially significant impacts on the development of the continent, including: 

• An annual average contribution of EUR 32.4m to tax revenues in Africa by the underlying funds.
• Support for some 4,700 indirect jobs in about 30 midcaps, SMEs and start-ups over the next 5 years, including 1,000 jobs created under the impetus of the equity investments of the underlying funds.
• Directly, 6 people should be working full-time between Bpifrance and Proparco over the next 5 years for the deployment of the capital of Averroès Africa and the support to the underlying funds.

The project will thereby support SDG 8 “Decent work and economic growth”.