IKnowAfrica consists of business and financial advisory consultants dedicated to solving the issue of access to capital faced by virtually all small and medium sized organizations in Africa. The firm is incorporated in Delaware, USA, as well as in Lagos, Nigeria, and its’ consultants reside in both countries.

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BUSINESS ADVISORY | FINANCIAL ADVISORY | FUNDRAISING
iKnowAfrica Invoice Discounting
IKnowAfrica consists of business and financial advisory consultants dedicated to solving the issue of access to
capital faced by virtually all small and medium sized organizations in Africa.
The firm is incorporated in Delaware, USA, as well as in Lagos, Nigeria, and its’ consultants reside in both
countries.
iKnowAfrica intends to build on experiences from business and financial advisory services over its eight (8)
years of existence to operate funds built on the basis of cost leadership, dedicated to solving specific access
to capital issues faced by small and medium organizations in diverse African markets.
It’s flagship fund consists of Invoice Discounting i.e. purchase of the receivables of small and medium
organizations held by large companies.
Attributes of our fund include the following:
1. Why Invoice Discounting?
a. Invoice discounting is provided by all commercial banks and finance houses. However, virtually
none focuses on invoice discounting as its main stream of income. This is because of a
combination of high operating overheads as well as larger revenue streams from other financing
activities such as treasury operations, direct lending to large organizations, and project financing.
This creates the opportunity for companies such as iKnowAfrica to become the market leader in
invoice discounting (as the go-to organization for access to working capital via discounted
invoices).
b. Small and medium sized organizations in most African markets do not readily have available
credit histories, ratings or scores unlike larger companies. Invoice discounting thus allows for
financing small and medium organizations on the basis of the credit scores of larger companies,
and provides a more secure alternative to direct lending to small or medium sized organizations.
2. How will it be done?
a. Small and medium sized organizations in need of credit and having receivables from large
organizations will execute the following:
i. Submit a simple application form with information about their company
ii. Attach company documents (including but not limited to company registration,
directors and ownership documents)
iii. Attach the relevant invoice(s).

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BUSINESS ADVISORY | FINANCIAL ADVISORY | FUNDRAISING
b. Applications will be accepted only if ALL the following are met:
i. The large company has a good or excellent credit score
ii. No directors or managers of the small or medium organization is a director or key
manager in the large organization where the receivables are.
c. Approved applications will require the following before funds are provided:
i. Legal transfer of the invoice to iKnowAfrica (signed by the small or medium
organization, by iKnowAfrica and by the large organization)
ii. A new invoice of the same amount from the large organization to iKnowAfrica
3. How will operating risks be managed?
a. By using annual rates
i. Discounted rates shall be 30% (which represents the average rate of short term financing
in Nigeria). For clarity, funds provided to small or medium organization shall be 70%
of the invoice amount.
ii. The mentioned rate shall represent a thirty (30) day rate of 2.5%, the balance of which
– that is, 30% minus (2.5% x No. of 30 days from payment by the large organization
to iKnowAfrica) – will be returned to the small or medium sized organization. In essence,
iKnowAfrica will assume a risk of delayed payment for up to a year (360 days) and shall
share this risk with the small or medium sized organization (whose interest it will be to
lobby the larger organization for early payments).
b. By using facilitators
i. Each transaction will be assigned a facilitator - a personnel in the credit industry in the
same geographical location as the large company - whose compensation shall be 7.5%
of the earned discounted invoice. The facilitator shall be required to facilitate the entire
transaction, including following up on payments from the large organization.
ii. The use of facilitators will allow the fund operate with variable overheads (i.e. per
transaction), while ensuring that the operations of the fund will not be limited by
geography.
iii. The compensation of the facilitator will be paid upon receipt of payment of the invoice,
thus sharing the risk of success with facilitators.
4. How will investments and investors be treated?

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BUSINESS ADVISORY | FINANCIAL ADVISORY | FUNDRAISING
a. Investments will be treated with as much liquidity as possible, without jeopardizing the
effectiveness of the model, in the following ways:
i. Investors may put in or withdraw funds at any time of their choosing.
ii. The size of investments shall accrue as sums of investments made plus profits earned
minus withdrawals.
iii. Profit shall be earned in the same proportion as accrued investment per investor to the
total fund size.
iv. Share of profit shall be calculated on the basis of sixty (60) days prior to the date profit
was earned. For clarity, share of profit today shall be the proportion of accrued
investment to total fund size sixty (60) days before today
v. Withdrawal of funds by investors will be limited to the size of their accrued investment
sixty-one (61) days from the date of withdrawal.
vi. Withdrawals shall be made through signed online submitted application forms that state
the following:
1. Size of withdrawal
2. Expected date of fund transfer
3. Currency of funds
4. Details of the bank account to be transferred to.
b. Investors will be provided with unique account numbers through which they may monitor the
size and progress of their investments online.
5. What are the expected returns?
a. Investors may expect returns between 19.5% (assuming all profits are withdrawn when earned)
and 55.7% (if all profits are compounded) on an annual basis.
b. Expected returns are based on an investor share of 65% of the total annual income of 30% of
their investment
6. In what currency shall transactions be made?
a. Transactions will occur in the local currencies of the markets operated in.
b. Accrued investment shall be in USD (converted according to official exchange rates on each day)

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BUSINESS ADVISORY | FINANCIAL ADVISORY | FUNDRAISING
7. What are our growth intentions?
a. Our mission is to operate invoice discounting fund sizes that are equal or above 0.2% of the
GDP of each African market operated in, starting in the continent’s largest economy - Nigeria.
b. We intend to keep our financing model light and fast by operating remotely through facilitators
and a reliance on ICT for banking and communication purposes.