Overview of the AECF:
Key Results and Future Plans
Hugh Scott - AECF Director
Presentation Outline
Overview of the AECF
Introducing the AECF
Finding the right projects
Funding Innovation
Market Systems
Key Results – Progress to date
Windows and Competitions
Applications and awards
Results and Impact
The Future?
Overview of the AECF
Introducing the AECF (1)
Goal: to accelerate pro-poor growth in Africa
Purpose: to make agribusiness, finance, renewable
energy and information market systems work better for
the poor in rural areas in Africa
Result: Increased jobs and incomes for large numbers of
people living in rural areas in Africa
Modus Operandi: The AECF works by supporting
private sector companies to develop and test innovative
business ideas in agri-business, rural financial services
and renewable energy in Africa
Introducing the AECF(2)
AECF is
– a fund of donor money available to the private sector on a
competitive basis
AECF is
– a ‘special partnership’ initiative of the Alliance for a Green
Revolution in Africa (AGRA).
– AGRA is chaired by Strive Masiyiwa and funded by Rockefeller
and Bill and Melinda Gates
AECF is
- a fund whose initial capital was US$34m in 2008 and is now
US$244m and growing (figure as at August 2014)
Finding the Right Projects
We seek to support business ideas that are
commercially motivated & innovative to get
systemic impact
Commercial Motivation: Scale required
for systems impact; scale will only be
reached if business model is (very)
profitable
SCALE
Disruptive Innovation: as a key
indicator of systemic change potential
• Upsetting the market such that
others will copy and replicate – the
more innovative the better
Principle: Start races rather than
picking winners
VFM: Provide minimum amount of
money to make business happen that
otherwise would not happen
VIABILITY
(SOCIAL)
IMPACT
Making Market Systems work paradigm
MARKET PLAYERS
Government
AECF
Informal
networks
SUPPORTING
FUNCTIONS
Information
Informing &
communicating
Demand
CORE
Supply
Setting &
enforcing
rules
Standards
Private sector
AECF
Membership
organisations
Laws
RULES
Not-for-profit sector
Key Roles of the AECF
Developing a
pipeline of
business ideas
Competitions: The Challenge Fund Mechanism is an
effective, open and transparent way to find large
numbers business ideas and capable entrepreneurs
Funding the
best business
ideas (that
others will not)
Finding and funding innovative business ideas
that are commercially viable should have impact on
large numbers of rural households. Providing
capital to “buy-down” risk
A feeder fund
for next level
financiers
Instill sound business/financial management to get
businesses more “investment ready”. Actively operate
as a feeder fund for next level, more commercial,
financial service providers and,
Achieve even more impact on even more people
Raising Further Capital
New service being offered to AECF grantees
Supporting grantees raise equity and debt
Scaling up post your AECF grant
Made available ‘free of charge’ but
– Limited availability
What can we do?
–
–
–
–
Structuring fundraising process
Introducing investors and lenders
Reviewing investor market materials
Helping negotiate terms with investors and lenders
Contact Seb McKinlay – sebastian@aecfafrica.org or
aecfafrica.org/connect
Key Results To Date
Fund Size Growth
244M
203.4M
183.6M
130.8M
75.6M
37.6M
2009
2010
2011
2012
2013
2014
8 Funding Windows
19 Competitions so far
General Window
(GW)
Agribusiness
Africa Window
(AAW)
Early Bird / R1-3
Zimbabwe
Window (ZW)
R1-3
R1
Post-Conflict
Window (PCW)
AECF
WINDOWS
R1
Tanzania
Agribusiness
Window (TZAW)
R1-R3
South Sudan
Window (SSW)
REACT Window
R1-3 + Moz
R1-2
Research Into
Business (RIB)
R1-2
AECF Applications Summary
Projects Approved
Business plans
Shortlisted for IC
Concept notes submitted
Registered companies
Performance to date
191
372
812
4,788
11,154
18 Rounds completed
5 June 2008 to
August 2014
Portfolio Growth – No. of Projects
178
191
91
58
39
2009
2010
2011
2012
2013
Portfolio Distribution – By Window
Funding and Geographical Spread
Development Impact 2013
Trends in Development
Impact
Development Impact by
Primary Beneficiary
Cumulative DRR by Sector
What is the Future?
The Future – Operational
Process/Operational Improvements:
Reduce time from competition closure date to contract sign-off
Reduce time from report submission to disbursements of funds
Improve business compliance through more active portfolio
management (not less compliance)
Introducing the AECF Grantee Network
AECF Connect playing a bigger role
Strengthen monitoring and results measurement
Ongoing and Forthcoming Competitions:
TZAW R3 at Business Plan Stage
REACT R3 – currently “live”
AAW R2 – October?
The Future – Strategic
AECF likely to become an independent legal entity (Trust/CLG)
Board of new AECF entity to decide how AECF will be managed and
by whom
More predictable funding – long term (10) year strategy to grow to
US$500m
A funder of innovation or a feeder fund for others (or both)
More windows v fewer, larger, windows (two flagships)?
More or less financial products – grants v loans v ….?
External evaluation and monitoring unit (EMU company)
CONTACT DETAILS
•
:+254 20 269 9137/8/9
•
:
www.aecfafrica.org
•
:
info@aecfafrica.org
•
•
: www.facebook.com/AecfAfrica
•
: www.twitter.com/AecfAfrica