They may be impact investors, but they’re in it to exit


African impact investors dispelled any notion that they are not too interested in financial returns at the recent African Angel Investor Summit (AAIS) in Cape Town, saying even impact funds want and need to make money.

Responding to the question of whether or not returns were crucial to impact investors on the continent, panelists were unanimous that making money was still at the very top of the agenda.

“We are all investors, so of course we are in it to exit. You can make these kind of investments and feel like you are doing good with your money as if you didn’t care at all,” said Lauren Cochran, managing director of Blue Haven Initiative.

“We are not super precious about what impact means. We definitely want to make our money back and make a commercial return.”

Sawa Nakagawa, chief executive officer (CEO) of E-Squared Investments, agreed, though she admitted impact investment firms could perhaps afford to wait a little longer for returns.

“We do invest with an intention to exit. We can take a very long approach to investing, we don’t have to exit within five to seven years, there is no pressure,” she said. “The impact will follow when the business case is proven.”

Danai Musandu, investment associate at Goodwell Investments, said there was little difference between impact and non-impact VC firms these days, as all investors were working in the same space.

“Mainstream investment is now moving towards opportunity, and that is where there is a large underserved market. The investments we make are becoming mainstream so they are attracting VC, because they speak to the majority of the continent,” she said.

Goodwell Investments has been down this road before, having begun life in India, and Musandu said there was similarities between the African scene now and India a few years ago.

“When we entered it was very early stage. It was seen as philanthropy. But with these investments came a lot of mainstream capital. So it is also a matter of maturity. Which is why when we invest we look at a timeframe of 10 years,” she said.

Musandu believes the way people understand “impact” needs to change.

“Generally the way people understand impact is around employment. That is a factor, but it is also limited. We need to understand that impact is about access. It is about understanding what business models have been created to create access. We need to shift our perspective. It is more about empowerment and giving a person the ability to create opportunities for themselves,” she said.

Maximilian Pichulik, co-founder of Impact Amplifier, went a step further.

“Job creation and access is only one layer. In the end impact comes down to people becoming more economically capable,” he said. “If human beings can be put into an environment where they can thrive, further themselves and their families, build self worth. Services will only get you so far. There’s a deeper layer that hasn’t really been addressed in impact investing.”


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Passionate about the vibrant tech startups scene in Africa, Tom can usually be found sniffing out the continent's most exciting new companies and entrepreneurs, funding rounds and any other developments within the growing ecosystem.

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