Agri09 day iii - session v - part ii - hugh scott - aecf
Africa Enterprise Challenge Fund Introducing the AECF EMRC, South Africa, June 2009
Presentation OutlineWhat is the AECFAims and Objectives of the AECFMaking market systems workHow the AECF worksApplication ProcessSelection CriteriaProgress to dateContact information
What is the AECF?AECF is a fund of donor money available to theprivate sector on a competitive basisAECF is a special partnership initiative of theAlliance for a Green Revolution in Africa (AGRA).AGRA is chaired by Koffi Annan and funded byRockefeller and Bill and Melinda GatesAECF is funded by a multi-donor consortium (DFID,Dutch, IFAD, CGAP etc). The donors form theGoverning Council of the AECFIt is managed by a KPMG led team (the FundManager). Other partners include ImaniDevelopment, Triple Line Consulting, Springfield,Creative Squares, and Y&RInitial capital is US$50m
Aims and Objectives of the AECF The Goal of the AECF is to accelerate pro-poor growth in Africa – increasing employment, livelihood opportunities, income and reducing poverty– The purpose of the AECF is to make agribusiness, finance and information market systems work better for the poor in rural areas in Africa– By impacting on market systems we aim to have a positive impact (jobs and incomes) on large numbers of people living in rural areas– The AECF works by supporting private sector companies to develop and test new and innovative business ideas in agri-business and rural financial services in Africa
How the AECF worksThe AECF manages a series of competitions, openonly to for-profit-companies for innovativeprojects in Africa. Best bids winWe have open competitions and focused sectoraland geographic windowsThe AECF provides grants and repayable grantsfrom a minimum of US$250,000 up to a maximum ofUS$1.5m per project (the average grant/loan size isexpected to be US$750,000)Companies have to at least match the fundsprovided by the AECFAECF funds are provided on a reimbursement basisunless otherwise agreed
Application ProcessBusinesses apply on line (seewww.aecfafrica.org for AECF selectioncriteria and applications forms)It is a two-stage process – initial applicationand then business planInitial applications are assessed, scored andranked by the Fund Manager (KPMG)Best applications are presented to AECFIndependent Investment Committee (IC) whoselect those to move forward to second,business plan stageIC selects which business plans are to befunded by AECF
Selection CriteriaCapacity of applicant to implement theproject (10%)Additionality (10%)Business Case (25%)Development Impact (30%)Systemic Change (15%)Innovation (10%)
AECF Performance Awarded grants 23 Business plans 52 Shortlisted for IC 110 Concept notes submitted 751Registered companies 1355 3 Rounds completed First Year Performance 5 June 2008 to 12 June 2009
Portfolio Impact Forecast Agribusiness Rural Total FinanceNumber of Projects 19 4 23Approved for fundingJobs to created by 7,067 462,094 469,161the businesses byend of Yr 3No. of people with 820,623 3,671,371 4,491,994improved livelihoodsby end of Yr 3Total 827,690 4,133,465 4,961,155
Example Project No 1 Western Seed Company - KenyaProject NameBringing seed technology to the farmerAmount of grant awarded by AECFUSD 1,500,000Project summaryThis project aims to bring improved maize seed varieties to 120,000smallholder farmers in Western Kenya thereby increasing productivity andrural farmer incomes. The project will introduce an innovative “DirectAccess System” ordering system using cellphones for seed orders,payments and the provision of information to farmers.
Example Project No 2 Monitise PLCProject NameMoniNet – Financial services for allAmount of grant awarded by AECFUSD 1,500,000Project summaryThe provision of mobile banking and payment services to enable the ruralpoor, and others, to gain access to secure and reliable financial serviceswithout the necessity of having a physical banking infrastructure. Theproject will enable mobile banking customers to save money, makepayments, transfer funds and deposit and withdraw cash through a widechoice of mobile networks, banks and mobile handsets.
Example Project No 3 Biolands Limited – Sierra LeoneProject NameSmallholder cocoa improvement in Sierra LeoneAmount of grant awarded by AECFUSD 940,000Project summaryThe project will improve the quality and quantity of cocoa (includingintroducing organic and social/fair trade certification) produced bysmallholder farmers in a remote area of Sierra Leone It will also improvethe marketing of the cocoa. The project will lead to an increase in theaverage farmer incomes from cocoa and provide a model for smallholdercash crop production in Sierra Leone. The company has already recruited25,000 farmers and exported 250 tonnes of high quality cocoa since theproject started in September 2008
In SummaryThe AECF’s challenge fund mechanism has greatpotential to make a positive impact on financialservices and agri-business across AfricaDemand for AECF funds is very high. Target was700 applications over 3 years – we have had 751 infirst 6 monthsCompetition for AECF funds is very high andapplications have to be of a high quality to have agood chance of winningWe welcome applications for the forthcomingRound 3 competition closing 15 July 2009
AECF Contact InformationPlease visit our website: www.aecfafrica.orgOr contact us by email: firstname.lastname@example.org