Women make up over 50% of Africa’s population, yet only 1.5% of funds raised by African startups between 2019 and 2023 were allocated to businesses led by women, according to a report published by TechCabal Insights. Four years ago, the African Women Impact Fund (AWIF) set an ambitious target to change this. It wants to raise $1bn in the next ten years that will be allocated to women asset managers in the African continent who in turn invest in high impact and underserved sectors, most of which feature women-led businesses. 

The Fund, launched by the Standard Bank Group along with its partners MiDA Advisors and RisCura Invest, has the backing of some of the world’s most powerful organisations. It has collaborated with UN Economic Commission for Africa (ECA), UN Women, the office of the special envoy on women, peace and security of the African Union Commission (AUC), and the African Women Leaders Network (AWLN). 

Why does Africa need more female fund managers? 

Bridging the gender divide could potentially increase Africa’s GDP by an estimated 10% by 2025, according to a recent McKenzie study. Research by the International Finance Corporation (IFC), also showed a direct correlation between diverse management teams and better fund performance. 

Lindeka Dzedze of Standard Bank notes that gender bias and other structural forms of inequality in Africa’s financial sector remains a significant hurdle. “Women in fund management play a crucial role in driving the inclusion of women in the financial services industry. Women fund managers bring diverse perspectives, which in turn lead to better decision-making and improved performance. Therefore, we must address these issues and dismantle the obstacles preventing progress,” she adds. 

She argues that history has proven that women can find solutions to seemingly unsolvable challenges. Despite facing challenges such as gender pay gaps and limited access to finance, they dominate Africa’s SME landscape, significantly contributing to job creation and economic growth, “so it doesn’t make sense for women to be massively under-represented in the fund management space,” says Dzedze. 

The African Women Leaders Network (AWLN) is a ground-breaking movement of African women leaders. It is led by African women leaders, including the first woman president of the Republic of Liberia, Ellen Johnson Sirleaf; president of the Federal Republic of Ethiopia Sahle-Work Zewde; and deputy secretary-general of the United Nations, Amina J. Mohammed. 

This unique partnership s of AWIF’s financing pillar stands out as a rare example of government bodies and private institutions, including Standard Bank and several other key players, coming together with a common and ambitious objective: to create a sustainable platform that supports and grows female run enterprises. This collective effort aims not only to fund women-led ventures but also to address systemic challenges and create a conducive environment for these businesses to thrive. 

Key figures such as Vera Songwe, former executive secretary of the United Nations Economic Commission for Africa and Bineta Diop, AU special envoy on women, peace and security, convener of the African Women Leadership Network and a Time magazine person of the year, have been instrumental in this initiative. 

AWIF’s journey in building sustainable business for women in Africa

Dzedze says another reason why Standard Bank wanted to be involved in AWIF is because women fund managers are more attuned to the gender dynamics within the industry. “As a woman in a leadership position at Standard Bank, I am particularly mindful when I enter a room and notice the lack of female representation at decision-making tables,” she says. “This awareness drives me to ensure that a wide net is cast when considering candidates for roles, emphasising diversity across gender, race, and other factors.” Diversity is crucial not only for performance, she stresses, but also for fostering a more inclusive environment. “This intentionality and deliberateness are essential in creating opportunities for women,” she says. 

According to a 2022 report by the African Private Equity and Venture Capital Association (AVCA), Raising the Bar: Executive Representation and Fundraising Disparities in African Private Equity and Venture Capital, only 12% of senior general partners in Sub-Saharan Africa are women. Globally, this figure is even lower at 11%. Between 2019 and 2023, only 1.5% of funds raised by African startups were allocated to women-led businesses. “These statistics highlight the significant barriers that still exist for women in finance,” she says. 

In investment decision-making, women fund managers tend to pay closer attention to diversity within the management teams of companies. This focus on gender diversity often leads to investments in women-led businesses, even if it is not an explicit mandate. This inherent bias towards supporting other women can have a profound impact on the industry, making AWIF’s journey to its goal that much more of a challenge. “The challenge is bigger than just us or one institution. We set the ambitious target for a reason: institutions across Africa share the same ambitious goal,” Dzedze says. 

The initiative is certainly not about diversity for diversity’s sake. “Women bring invaluable perspectives and capabilities to the table. My own career success is a testament to the fact that women in finance are capable and results driven. Often, societal biases and historical exclusion have prevented many talented women from participating fully in the financial sector,” she adds. 

Women in the financial sector face unique challenges

Women in the financial sector, particularly in Africa, face unique challenges. One major issue is the credit gap, with women entrepreneurs across the continent facing a staggering $42bn shortfall in financing, especially in agriculture. This sector is crucial for food security, yet women farmers struggle to access necessary funding. 

Additionally, women fund managers often start small and lack the extensive track records of their male counterparts. The operational infrastructure required to manage funds effectively is another significant hurdle. Fundraising is a bruising process, and without sufficient support, many women-led businesses do not survive. 

Initiatives such as AWIF are crucial in addressing these challenges. “It provides comprehensive support to women fund managers, including working capital, technical assistance, and environmental, social, and governance (ESG) practices. This holistic approach ensures that women-led businesses have the resources they need to succeed,” she says. 

A notable feature of this collaboration is the Manager Development Programme, designed to build a critical mass of support for women who are not yet fully established in their industries. This emphasises the importance of choosing the right partners, such as global investment firm RisCura Invest, which has a broad and deep understanding of African markets and is committed to finding and nurturing women fund managers through hands-on engagement. 

A vision for the future in Manager Development Programme

The Manager Development Programme is run under the AWIF Foundation, which has awarded a grant of $60,000 to Altree Capital to make initial investments in their portfolio companies. 

Altree Capital, investing with a gender-lens and climate-smart approach in sub-Saharan Africa, focuses on five investment pillars: women entrepreneurs, women in leadership (ensuring businesses have at least 30% women in management or board positions), employers of women (supporting companies with over 30% female employees), and products & services benefiting women (investing in businesses that improve the lives of women) and women in the supply chain. 

The collective effort of various stakeholders, driven by a shared mission, aims to create a sustainable and inclusive economic environment. Women fund managers are essential in driving the inclusion of women in the financial services industry. Their intentional efforts to promote diversity, coupled with initiatives like AWIF, are helping to dismantle structural biases and create a more inclusive environment. By addressing the entire ecosystem, from working capital to regulatory compliance, these initiatives ensure that women-led businesses can thrive and contribute to Africa’s growth agenda.

Focused on the future

The primary focus for AWIF in 2024 is to continue fundraising for the AWIF Private Markets Funds’ first close of $500m. In doing so, Standard Bank continuously seeks partners with shared values to join forces with and help bring scale to their innovative solution.

As part of its fundraising efforts, AWIF is currently engaging some of Africa’s largest institutional investors. Support from these institutions is crucial, as they are not merely ticking a box for diversity; they are collaboratively committed to ensuring these initiatives succeed. This commitment is evident in their willingness to incur the costs and efforts associated with thorough due diligence processes. The collaboration between these institutions highlights a collective effort to drive gender equity and sustainable investment.

The success of AWIF’s initiative hinges on strong partnerships and collaboration. These partnerships bring together resources, expertise, and a shared vision to drive sustainable development in Africa.

One of the collaborative partnerships is that of AWIF with global investment firm, RisCura, an initiative that can leverage their leading Manager Development Programme to provide training and upskilling of fund managers. RisCura has over 20 years’ experience in developing managers who today are market leaders; it currently manages $400m of assets under its Manager Development Program.

As these efforts continue, the goal is to see tangible outcomes: women managers holding significant investments; businesses thriving under women’s leadership; and a continent moving towards a sustainable and inclusive future.

This vision, backed by unwavering commitment and strategic partnerships, promises to drive meaningful change across Africa.

Investing in women

It’s clear that the female economy, encompassing women in business, the value chain, and the community, holds immense potential and will serve as a pivotal catalyst for future growth across Africa. So, what does invest in women look like?

Gender-Lens Investing: There has been a steadily growing trend globally towards gender-focused investing to generate impact, driven by the recognition of the economic benefits of gender equality and empowerment. Gender-Lens investing (GLI) is an investment approach in which private sector investment is committed to improving access to entrepreneurship, leadership opportunities, employment, finance, and products and services that enhance women’s economic participation in developing country markets.

The 2X Challenge, spearheaded by development finance institutions (DFIs) and international financial institutions (IFIs), has set a solid foundation for gender-lens investing in Africa, encouraging private investors to adopt it as a strategic approach: unlocking gender-smart capital at scale to generate sustainable impact.

From 2021 to 2022 the initiative exceeded its target, driving gender-lens investments totalling $16.3bn and benefiting 473 businesses across Africa, Asia, Central and Eastern Europe, Latin America, and the Caribbean.

The German DFI DEG (Deutsche Investitions- und Entwicklungsgesellschaft) has positioned itself as an active pioneer in the space, connecting clients to networks and resources of the female economy as a partner of The Boardroom Africa in addition to being a founding member of the 2X Challenge.

Against this backdrop, Africa has witnessed the emergence of several funds in recent years, such as Alitheia Capital and Aruwa Capital Management, with strong intentionality on gender. Indeed, private equity represents the highest asset class globally for the number of GLI-focused impact funds open for investment.

These collaborative efforts highlight the importance of women’s economic empowerment in impact investing and affirm our collective responsibility to advance towards a more gender-equal society.

Case Study: Fund Manager, African Women Impact Fund

The African Women Impact Fund (AWIF) Foundation, dedicated to supporting women-led funds and businesses across Africa, awarded a grant of $60,000 to Altree Capital.

This funding aims to catalyse Altree Capital’s investment initiatives, particularly focusing on their gender-lens and climate-smart approach in sub-Saharan Africa, with a notable presence in East Africa.

Altree Capital’s Investment approach embodies the following four key pillars:

1. Women Entrepreneurs: Prioritising investments in businesses led by women;
2. Women in Leadership: Ensuring that businesses have 30% or more women in management or board positions;
3. Employers of Women: Supporting companies where over 30% of the workforce are women; and
4. Products and Services Benefiting Women: Investing in businesses that provide products and services aimed at improving the lives of women.

Additionally, Altree commits to holding at least 40% of its fund in climate opportunities across, focusing on food systems, e-mobility and renewable energy. It also works to incorporate sustainable and environmentally friendly practices, aiming to mitigate climate change and promote resilience in the region across its portfolio.

Jenni Chamberlain, CEO of Altree Capital, highlights the significance of this initiative: “There are numerous barriers to African women accessing finance for their businesses; women-led businesses are an important yet overlooked sector of the economy,” she says.

“Altree will prove the ability of these companies to produce strong returns for female entrepreneurs and investors alike. Not only are women most affected by climate change, but women are early adopters of climate mitigation and adaptation technologies and solutions, as well as strong benefit multipliers. Supporting women-led and oriented firms, empowers women, ensures climate action, and will transform economies and societies,” concludes Chamberlain.

By supporting Altree Capital, AWIF underscores the importance of gender equity and climate-smart investment strategies in driving sustainable development in Africa. This partnership is a critical step towards transforming economies and societies, ensuring that women play a central role in the continent’s economic future.