Kenya is the clear hub for impact investing in East Africa, accounting to more than half the impact capital deployed in the region, according to new research by the Global Impact Investing Network (GIIN) and Open Capital Advisors.
A new report published by GIIN in partnership with Open Capital Advisors analyses the impact investing landscape in East Africa, with detailed chapters for five countries – Kenya, Uganda, Tanzania, Ethiopia, and Rwanda – plus chapters on six additional countries in the region.
The research shows Kenya to be the leading location for impact investing in East Africa, with more than half of the investments recorded occurring in Kenya. However, countries such as Ethiopia and Uganda showed growing promise for impact investors.
The report finds development finance institutions (DFIs) are a key player in the market, having deployed nearly US$8 billion in impact capital to date. However, other types of investors – such as venture capital and private equity funds, foundations, family offices, commercial banks, and angel investor networks – are increasingly active, having deployed a combined total of over US$1.4 billion to date in the region through more than 550 deals.
“East Africa is an impact investing market that is still growing and evolving, but we are seeing a lot of momentum,” said Amit Bouri, chief executive officer (CEO) of the GIIN.
“We hope this report will serve as a useful resource to help current and potential investors navigate this dynamic market.”
According to the report, the areas of agriculture, renewable energy, water and sanitation are areas posing increasing opportunities for investors.
The study was prepared based on relevant literature, transaction data, and interviews with key industry stakeholders.
The detailed country chapters include information on the supply of capital by investor type, investment opportunities by sector, as well as regulatory considerations and hurdles for impact investors and investees.
“We are excited to share research that will help investors better understand the region,” said Annie Roberts, partner at Open Capital Advisors.
“Over the past five years since we founded Open Capital, we’ve seen a dramatic increase in interest in the region, and hope this new research will spur even more local activity. Some investors fear a lack of deal flow, but as this report shows, East Africa is a vibrant market with a large number of impact investments happening every year.”