Investment approach
AHL Venture Partners puts entrepreneurs first. We make decisions quickly, invest with the intention to participate in subsequent funding rounds, provide ongoing business support and have accessible teams based on the ground with a deep understanding of the local business environment.
A Company's Investment Journey with Us
It all begins with an idea. Maybe you want to launch a business. Maybe you want to turn a hobby into something more. Or maybe you have a creative project to share with the world. Whatever it is, the way you tell your story online can make all the difference.
We focus on identifying incredible founders and supporting their companies' growth at every stage with fit-for-purpose capital, advisory support from our team and network of experts, and targeted technical assistance.
Priority sectors
Energy Access
Since its inception, AHL has championed and invested in companies that address access to energy through equitable and scalable business models. The energy sector faces four interrelated challenges: insufficient installed capacity, limited last mile distribution; poor reliability; and high costs. Only 14% of Africans living in rural areas have access to electricity, leaving more than 500 million people without access. Building commercially viable models that expand access to affordable off-grid energy is critical.
Financial Inclusion
Only 10% of the world's poor can access vital financial services. This exposes them to sudden, unexpected risks like illness or drought. Financial services such as savings, insurance and asset leasing tailored to rural markets can improve the safety net of millions of people and enable productive investments in small enterprises.
Agriculture and Food
Approximately 75% of people living in Africa rely on agriculture. Increased agricultural productivity and improved integration of smallholder farmers into agricultural value chains are needed to improve millions of people's f
Investment products
Bridge Debt
Based on more than ten years of experience, we noticed a recurring issue – companies struggle to meet short-term funding needs due to delays in capital raises, sudden growth, long timeframes to closing asset sales, etc. This pushes founders to scale down operations and development or, worse yet, destabilise a capital raise.
To address this, AHL launched our Bridge Debt Product. We move quickly to provide short-term financing to bridge companies to an impending liquidity event. We fill the gap for those high-growth businesses looking to maintain operations at scale but may have a cashflow challenge.
Company Stage
Series A +
Financial
$3m+ of Revenues; or
Performance
$5m+ of Gross Assets
Ticket Size
$500,000 to $3m <=25% of next equity raise
Tenor
6 - 18 months
Security
Unsecured
Can be subordinated to existing senior debt
Seniority
The loan is non-amortising but repayable in full on the completion of the next equity or debt fundraising or the maturity of the loan
Repayment
12% - 16% depending on risk with a minimum return in case of early repayment
Interest
Targeted to be fast <90 days based on company's readiness
Turnaround Time
Food & Agriculture, Energy and Climate, Financial Inclusion
Sectors
What this product is and is not for…
⚪ Companies who have just begun their raise and have a short-term cash crunch
✓ Companies with a strong investor base and demonstrable interest from multiple new investors
⚪ Financing payroll
✓ Financing continued growth
✓ Achieved product-market-fit and now scaling
⚪ Financing R&D or early-stage pilots
Working Capital Debt
Companies are struggling to meet their immediate working capital needs, pushing them to scale down operations or delay executing contracts. While there are many organisations in the market providing access to working capital, there are few able to move quickly and flexibly to meet the immediate funding needs of the businesses.
We see an opportunity for this product in the market with an investment team on the ground and an ability to act fast to support companies at critical times.
EBITDA+ now or within the next six months; Strong gross margins or short working capital cycle
Company Stage
Min. Annual Revenues
$1.0 million
Ticket Size
$1m - $3m; ability to increase loan size over time
1 - 4 years, matching working capital cycle; ability to revolve
Tenor
Senior and secured (equity cushion required)
Security
10% - 15% on USD depending on risk and potentially an equity warrants
Interest
Revenues growth >30%
Potential to scale up facility
Strong management teams
Well capitalised
Target Company Characteristics
Targeted to be fast 3-6 months based on company's readiness and complexity of structure
Turnaround Time
Sectors
Food & Agriculture, Energy and Climate, Financial Inclusion
What this product is and is not for…
⚪ Companies that already have sr. secured lenders that are unwilling to extend security to new lenders
✓ Companies with positive cashflows, current or fixed assets for security; or willing to consider a share-pledge
✓ Companies post product-market fit, predictable revenues and high growth potential
⚪ Companies without positive cashflow and would need to repay AHL via. a refinancing
Equity
AHL has over a decade of experience making direct equity investments in Africa. As the market and AHL have matured, we have refined our equity strategy to focus on the sub-sectors where our expertise and other investment products can add the most value: B2B/B2C lending, agri-processing, and climate-tech.
We make initial investments from seed stage through to growth stage and can follow on in subsequent rounds. As we invest out of a permanent capital vehicle, as opposed to a traditional 10-year fund, we can take a long-term view, making multiple successive investments in high-performance companies.
Value Creation
The AHL team delivers value creation support directly and through an extensive local and international network of service providers and experts.
Impact
Implementing the Sustainable Development Goals (SDGs) will have transformational impact in combating global inequalities, setting out ambitious goals to alleviate extreme poverty, protect the planet and foster relevant partnerships to achieve these goals.
The OECD estimates that the SDG financing gap has increased by at least 50%, totalling USD 3.7 trillion. In emerging markets across Africa, where needs are most acute and financing capacity the lowest, private and public sector actors will need to work together to address financing needs. Closing the SDG financing gap requires an approach that promotes investment in the long-term while building resilience across the SDGs.
AHL contributes to filling this funding gap by investing in companies with business models that align impact with growth. Rigorous impact management and measurement from due diligence to exit are at the core of AHL's investment strategy. The impact thesis of each potential investment is contemplated by the Fund and assessed against our internal Theory of Change to ensure that beyond being a sectoral fit, the investment is aligned with our ultimate desired contribution to the SDGs, as shown in the diagram below.
In addition to this, our impact strategy aligns with the Impact Measurement Project's ("IMP") five dimensions of impact to assess the range of impact that each prospective investment will have.
Gender
AHL is committed to promoting increased participation of women in the economy. Our investment strategy and processes integrate considerations of gender at multiple levels.
AHL Venture Partners is an inaugural member of the Gender-Smart Enterprise Assistance Research Coalition (G-SEARCh), a group of six impact investors committed to building the business case for investing with a gender lens in small and medium enterprises in emerging markets.
As part of the consortium, AHL Venture Partners provides gender-smart technical assistance to portfolio companies to provide knowledge and lessons as they seek to become more inclusive and gender-equitable and to impact investors, as they allocate resources to gender-smart interventions and approaches so that impact investing becomes a tool for gender transformation.