Vital Capital has partnered with USAID to provide funds to various sectors of the Kenya’s economy that have been adversely affected by the COVID 19 pandemic.
Through the Kenya Investment Mechanism, a USAID project unlocking capital for businesses in Kenya, Vital Capital, a pioneering impact investment, private equity fund focused on companies in sub-Saharan Africa, has launched a fund to support Kenyan agribusinesses during these economic hard times.
KIM aims to unlock $400 million in investments for key sectors among them agriculture, and for regional trade and investment opportunities to foster broad-based, sustained, and inclusive economic growth in Kenya.
“We are excited to launch this major collaboration to support Kenyan agribusinesses in what is an incredibly challenging economic environment,” said Nimrod Gerber, Managing Partner, Vital Capital.
Nimrod said they believe the collaboration has the potential to effect real change and support smallholder farmers survive the worst ravages of the COVID-related economic crisis.”
COVID-19 has threatened the livelihoods and food security of millions in the Country at a time when they are dealing with the worst locust infestation in 70 years and trying to recover from extensive flooding.
Around 27% of households are suffering from food shortages, according to a recent survey by the World Bank, while in May, the Central Bank of Kenya warned that some 75% of the Country’s SMEs were likely to collapse if they didn’t access funding from banks or equity partners.
Vital Capital and KIM will identify potential opportunities in KIM’s pipeline that corresponds to Vital Capital’s investment mandate and are seeking to identify and execute at least five completed transactions, providing at least $5 million in financing, to alleviate the strain of COVID-19 on impactful Kenyan businesses, sustaining 500 jobs.
The collaboration follows Vital’s launch in April of the Vital Impact Relief Facility, a $10 million emergency loan facility to offer critical funding to promising African businesses to help them overcome the economic consequences of the COVID-19 pandemic.
“This collaboration with KIM is a significant validation of our approach and we look forward to working closely together to identify new opportunities and unearth companies providing essential services to communities in Kenya to preserve their impact and employment,” said Guido Boysen, Co-Lead of the Vital Impact Relief Facility.
“Vital Capital was quick to recognize and fast to respond to the economic consequences of COVID-19 in Kenya, and we are pleased to collaborate with them,” said Roger Bird, Kenya Investment Mechanism Chief of Party.