<h1 style="text-align:center;">An Angel Investor's Tour to Ethiopia, Uganda and Rwanda</h1>At the end of January, a longtime member and IAN investor, Dr. Andrew Umhau, joined Matt, Laura and Brooklyn on a regional trip across East Africa to see how the Ethiopia <a href="../../marketplace/portfolio.html">portfolio</a> was doing, meet new companies in Ethiopia and Uganda, and explore Rwanda. It was Dr. Umhau’s first trip back to Addis in over 7 years and a lot has changed since he last visited, including the amount of growth the country has undergone.<figure class="image image_resized" style="width:100%;"><img src="/uploads/img_5912_2_2673dc655f.jpg"></figure>Over the course of the week with RENEW, Andrew was able to visit over 20 different businesses. This included a number of site visits, as well as meetings with partners and entrepreneurs. It was a unique opportunity for him to see some of the businesses his family had invested in, as well as other companies in the RENEW portfolio and in the current pipeline. Visiting RENEW in-country is always a valuable trip and provides a first-hand experience seeing the companies that are discussed on our Monthly Members’ Calls.After a few days in Addis, Andrew and the RENEW partners took off for Kampala, Uganda. Joined by our team member in-country, Mary Adoi, the group had the opportunity to visit with 16 different businesses currently interested in receiving financing. The entrepreneurs in Uganda were eager and excited for the prospect of working with RENEW.<figure class="image image_resized" style="width:100%;"><img src="/uploads/img_6039_2_20d69849ab.jpg"></figure>The last leg of the journey was a stop in Rwanda: an exciting, young country vibrant with businesses. The team agreed there was a lot of growth potential in the country, and were excited by the people and the city of Kigali.Overall, Dr. Umhau experienced first-hand how RENEW works in-country. He had the chance to meet our team on the ground as well as a number of businesses, and he was able to witness some of the training and vibrant community that has been built at the Exchange.<figure class="image"><img src="/uploads/img_6140_3d45539148.jpg"></figure>

img_5912_2.jpg

An Angel Investor's Tour to Ethiopia, Uganda and Rwanda

<h1 style="text-align:center;">Press Release: Official Launch of KROTAJ Tahini Manufacturers PLC’s Processing Factory</h1><a href="https://renewcapital.com/sites/default/files/02.11.2019_-_press_release_-_krotaj_launch_final_1.pdf">Download the Full Press Release.</a>Addis Ababa, Ethiopia February 11, 2019 -- On February 12, 2019, KROTAJ Tahini Manufacturers PLC (KROTAJ), will host a formal launch event to celebrate the opening of its tahini factory in Addis Ababa. Visitors will witness the production of tahini at the newly certified factory and sample the product.Date: February 12, 2019 Time: 3 PM in the afternoon Location: Nifas Silk Lafto Sub City Woreda 12 (Lebu, Mebrat hayel behind Haile Garment)KROTAJ is an international partnership of sesame experts and investment professionals formed to produce world-class tahini close to the source of some of the world’s finest sesame from the Humera region of Ethiopia. The company’s mission is to become the leading provider of tahini to the international food processing industry.<figure class="image"><img src="/uploads/img_5956_40fb42729f.jpg"></figure>Sesame is one of the leading agricultural products exported by Ethiopia, generating a significant amount of foreign currency revenue for the country. Value addition to sesame in Ethiopia has so far been limited, but has the potential to both increase overall revenue for Ethiopian sesame producers and open up new markets worldwide.The company, by sourcing sesame locally, will support thousands of smallholder farmers and strengthen the sesame industry in Ethiopia. The new factory plans to produce 3,758 tons of tahini per year and directly employ more than 40 staff at full capacity. KROTAJ is anticipated to have a significant impact on the local economy and its shareholders and managers are excited to celebrate this milestone of opening a state-of-the-art tahini processing factory in the home of the some of the world’s best sesame. “We are grateful for our Ethiopian, Israeli and U.S. partners who have helped us get to this stage of launching a tahini factory in Ethiopia,” CEO, Dr. Mulugeta Kidanemariam, recently said.<figure class="image image_resized" style="width:100%;"><img src="/uploads/tahini_fotor_2_0_a31a796afd.jpg"></figure>“Our partners include Wegagen Bank, many Government partners, and several U.S. investors, including RENEW and the Impact Angel Network,” said Meseret Kidanemariam, sister to Dr. Mulugeta and a co-founder. “Each group has been integral in helping us get to this key stage. Now it’s time to produce and export exceptional tahini to the world market,” she continued.As a key stakeholder, RENEW and the Impact Angel Network (IAN) are proud to partner with KROTAJ Tahini Manufacturers PLC.&nbsp;###

img_5956.jpg

Press Release: Official Launch of KROTAJ Tahini Manufacturers PLC’s Processing Factory

<h1 style="text-align:center;">Press Release: RENEW and the IAN Make Second Investment in Logistics and E-Commerce Company in Ethiopia</h1>Denver CO and Addis Ababa, February 19, 2019 -- Members of RENEW’s <a href="https://www.renewcapital.com/what-we-do/investing">Impact Angel Network</a> (IAN) have funded a second investment in Roadrunner Technology Solutions LLC (Roadrunner), which partners with Universal Courier Services PLC (<a href="https://deliveraddis.com/">Deliver Addis</a>) to expand the burgeoning logistics and e-commerce industries in Ethiopia. Deliver Addis is a technology enabled, online food delivery company based in Addis Ababa, Ethiopia, launched in October 2015. Deliver Addis has succeeded in building a loyal customer base by offering meal delivery services from select restaurants around Addis Ababa. Since the IAN’s initial investment in 2017, the company has focused on three main service areas: logistics, B2C focused e-commerce and technology.<figure class="image"><img src="/uploads/roadrunner_almost_done_887f39dc57.jpg"></figure>Roadrunner and Deliver Addis utilized the IAN’s initial investment to enhance and expand its restaurant delivery services for consumers in Addis Ababa. Roadrunner developed a technology platform for Deliver Addis which has enabled the courier company to significantly reduce average delivery times, handle higher volumes and add additional service offerings. In addition, Roadrunner launched a new website for Deliver Addis with additional features, including a loyalty program and credit card payment options, as well as new restaurant offerings. With the IAN’s second investment, Deliver Addis intends to expand its service offering, allowing customers to order deliveries from a wider range of restaurants, as well as a soon-to-be-launched menu of retail products. The company also aims to expand its offering into new markets, making deliveries accessible to a wider segment of the Ethiopian population.“RENEW and the IAN exist to invest in smaller companies like Roadrunner and Deliver Addis, which are creating jobs for Ethiopian men and women by supporting local businesses and which can deliver strong performance following an investment,” said Matthew Davis, RENEW’s CEO. “We are pleased to be investing a follow-on round at a time when Roadrunner and Deliver Addis are positioning themselves as leaders in the nascent e-commerce industry in Ethiopia. We could not invest in companies like Roadrunner if it were not for Global Affairs Canada and USAID, and we are grateful for our partnerships with them.”<figure class="image"><img src="/uploads/deliveraddis2_0_80bacb826e.jpg"></figure>“RENEW and the IAN have been incredible partners during our growth since their first investment last year and we're glad to see that they are as optimistic about Ethiopia as we are,” said Feleg Tsegaye. “Since their first investment, we've been able to generate significant value for our partner restaurants as well as expand and optimize our driver fleet to ensure we're satisfying the needs of an ever-growing customer base. We're looking forward to our next chapter of growth and our continued relationship with RENEW's support.”About the Impact Angel Network and RENEW The Impact Angel Network is one of the most active private equity investors in Ethiopia. Its members seek to make both social impacts and financial returns through investments in small and medium enterprises (SMEs); a proven engine of economic growth and job creation, but lacking capital in Africa due to their size. They believe that targeting employment through SMEs, dollar-for-dollar, can help reduce poverty in a more sustainable way than charity.RENEW, with its largest office in Addis Ababa, Ethiopia, manages the IAN’s investment operations and provides investment advisory and consulting services in support of its investments. RENEW’s work in Ethiopia was piloted with USAID and is currently undertaken with financial support from the Government of Canada provided through Global Affairs Canada. The project, Accelerating Business Growth, aims at sustainable job creation for low-skilled workers, including women and young adults, through a dynamic and growing small and medium business sector in Ethiopia.&nbsp;###

The IAN's second investment in Roadrunner.

deliveraddis2_0.jpg

Press Release: RENEW and the IAN Make Second Investment in Logistics and E-Commerce Company in Ethiopia

<h1 style="text-align:center;">An Ode to Africa's Businesswomen</h1>Close your eyes for a few minutes and imagine that you are a businesswoman in East Africa. What inequalities might you face? What extra challenges might come into play as you go about the daily work of growing your business? Are there extra family obligations your life might entail that your male counterparts don’t typically face? How about equal access to land, finance and markets?According to a recent study conducted by the IFC, Sub-Saharan Africa (SSA) has the largest proportion of financially constrained small and medium enterprises (SMEs) (54%) in the world.[1] Women-owned SMEs in SSA face additional barriers to trade and finance because they often lack the collateral, banking relationships and market linkages afforded to their male counterparts. The same IFC study outlines that, despite their smaller average size, female-owned businesses in SSA account for an outsized share of the finance gap, at $42B.[2]As an example, one of our portfolio companies, Mama Fresh, is an injera company in Ethiopia and is a family business comprising of Konjit Zewdie and her husband Hailu and son Miraf. The Mama Fresh team has been baking injera daily in Ethiopia since 2003. With entities registered in Ethiopia and the United States, the company now offers a range of traditional Ethiopian food products and consumers can find Mama Konjit’s food in restaurants and retail outlets in Ethiopia, the United States, Sweden, Norway, Germany, Hong Kong, Kuwait and Nigeria. The company currently has 39 employees, and 69% are women.<figure class="image"><img src="/uploads/mamafresh_0_d4d0a5ebff.jpg"></figure>Global Affairs Canada (GAC) worked with RENEW to design and implement the Accelerating Business Growth (ABG) Project in Ethiopia. ABG helps address some of the challenges faced by companies like Mama Fresh. The project helps SMEs, especially women-owned and managed, access finance from a growing network of domestic and international angel investors committed to building Ethiopia’s economy. The ABG project goes beyond addressing access to capital; it provides an executive training program for the C-suite of companies, helping them build and strengthen their governance, financial management and sales and marketing. All of this aims to create thousands of jobs in Ethiopia and build a vibrant and sustainable economy in Ethiopia.Here are some numbers that we are tracking for the ABG to keep us focused on building gender equality:<ul><li>40% of the SMEs that have received an investment from our angel investors have female shareholders. We want this to get above 50%.</li><li>70% of the jobs provided across our portfolio are held by women.</li><li>40% of participants in The Exec’s Program are women. We will push to get this to 50%.</li><li>38% of the professionals in the CFO100 are women. We want more!</li><li>39 or 27% of the North American angel investors are women. We want to have more women join the IAN.</li></ul>And finally, 50% of the RENEW team that manages the ABG project are women. Gender-balanced! Why is gender equality so important for projects like ABG? Just as women are often the backbone of a family, they are also the backbone of an economy. And this is why all of the work we do at RENEW and with our partners at Global Affairs Canada emphasizes gender empowerment and equality.So please stay in touch to keep learning about the high-impact work we are doing in Sub-Saharan Africa. There is much more coming on the horizon.

mamafresh_0.jpg

An Ode to Africa's Businesswomen

<h1 style="text-align:center;">Press Release: 2019 International Gathering</h1><a href="https://latest-api.renewcapital.com/uploads/RENEW_Press_Release_National_Gathering_0ab80728fc.pdf">Download the Full Press Release.</a>Washington, D.C. March 26, 2019 --The <a href="https://www.renewcapital.com/what-we-do/investing">Impact Angel Network</a> (IAN), a global angel network dedicated to investing in high-potential companies across the continent of Africa, has announced the IAN’s <a href="https://www.renewcapital.com/resources/blogs/2019%20International%20Gathering%20-%20Thank%20You%20to%20our%20Sponsors%20">2019 International Gathering</a>. This year, the Gathering will be held on May 17th, 2019 at the Embassy of Canada in Washington, D.C.The event’s keynote speaker will be <a href="https://www.carlyle.com/about-carlyle/team/david-m-rubenstein">David Rubenstein</a>, co-founder and co-executive chairman of the Carlyle Group. Join us for a fireside chat as he shares his story about building one of the world’s most successful private equity firms and how he views opportunities in Africa. Attendees will also interact with other special guests and dignitaries, and hear IAN members’ personal stories about how they help finance companies managed by smart and successful Ethiopian entrepreneurs for impact and financial returns.Organized by RENEW, an impact and investment advisory firm which manages IAN, the annual Gathering convenes IAN members and guests to explore the dynamic investment landscape in sub-Saharan Africa, through the lens of SME investing. Guests will spend the evening at the Embassy of Canada, overlooking the Capitol Building, with other like-minded individuals, business executives, thought leaders and experts in the impact and angel investing space. RENEW aims to elevate angel and impact investing and how the private sector is driving growth. The Gathering is a great opportunity to have important conversations related to impact investing and how we’re all contributing to an entrepreneurial culture on the continent and to Africa’s growth story.<figure class="image"><img src="/uploads/screen_shot_2019_03_28_at_3_19_00_pm_c99bbcfb0d.png"></figure>Tickets for the event are available until Monday, May 13th and can be purchased at <a href="https://2019-international-gathering.eventbrite.com/">this link</a>. For more information about sponsorship opportunities please visit our <a href="https://www.renewcapital.com/what-we-do/investing">website</a>. Additional events will be held exclusively for IAN members throughout the weekend. If you’re interested in learning more about the IAN or joining the network please visit the following <a href="https://www.renewcapital.com/apply">link</a>.We’d like to thank the following partners and sponsors for making the 2019 International Gathering possible: The Embassy of Canada (co-host), <a href="https://www.faegrebd.com/en">Faegre Baker Daniels</a> (platinum sponsor), <a href="https://limalimolodge.com/">LimaLimo Lodge</a>, <a href="http://enlightenmentwines.com/">Enlightenment Wines</a> and <a href="https://kanterpr.com/">KANTER</a>.About the Impact Angel Network and RENEWThe Impact Angel Network is one of the most active private equity investors in East Africa. Its members seek to make both social impacts and financial returns through investments in small and medium enterprises (SMEs), a proven engine of economic growth and job creation, but lacking capital in Africa due to their size. They believe that targeting employment through SMEs, dollar-for-dollar, can help reduce poverty in a more sustainable way than charity.RENEW, with its largest office in Addis Ababa, Ethiopia, manages the IAN’s investment operations and provides investment advisory and consulting services in support of its investments. RENEW’s work in Ethiopia was piloted with USAID and is currently undertaken with financial support from the Government of Canada provided through Global Affairs Canada. The project, Accelerating Business Growth, aims at sustainable job creation for low-skilled workers, including women and young adults, through a dynamic and growing small and medium business sector in Ethiopia.&nbsp;###

Angel Network Focused on SMEs in sub-Saharan Africa to Host Fourth International Gathering.

screen_shot_2019-03-28_at_3.19.00_pm.png

Press Release: 2019 International Gathering

<h1 style="text-align:center;">2019 International Gathering - Thank You to our Sponsors!</h1>On May 17, 2019, the IAN’s <a href="https://www.renewcapital.com/resources/blogs/Press%20Release%20%202019%20International%20Gathering">International Gathering</a> will convene members and guests to explore the dynamic investing landscape in sub-Saharan Africa through the lens of SME investing. For the second time, guests will spend the evening at the beautiful Embassy of Canada in Washington, D.C., overlooking the Capitol Building. For the past three years, RENEW has partnered with <a href="https://www.canada.ca/en.html">Global Affairs Canada</a> through our work under our <a href="https://w05.international.gc.ca/projectbrowser-banqueprojets/project-projet/details/D002584001">Accelerating Business Growth</a> (ABG) program. We are grateful for the support from the Embassy of Canada and Global Affairs Canada for co-hosting this memorable event with us.We’d also like to highlight all our sponsors who are helping to make this International Gathering the best one yet:<ul><li><a href="https://www.faegrebd.com/en">Faegre Baker Daniels</a>: Faegre Baker Daniels (FaegreBD), our Platinum Sponsor, is one of the 75 largest law firms headquartered in the U.S., with locations that span coast to coast and also cover the U.K. and China. Their offices collaborate to achieve clients’ objectives - bringing together the best-matched expertise and resources from across their global platform. FaegreBD’s legal and consulting professionals partner with clients ranging from emerging startups to multinational corporations, delivering full-service advice customized to each company’s business needs.</li><li><a href="https://kanterpr.com/">KANTER</a>: KANTER is a public relations firm for the investment management industry. They help a variety of investment firms build their brands and become better known through meaningful and high-quality press, as well as a continuous presence in the media. Kanter is led by <a href="https://www.linkedin.com/in/victoria-odinotska-7b2a025/">Victoria Odinotska</a>, a member of the Impact Angel Network.</li><li><a href="http://enlightenmentwines.com/">Enlightenment Wines</a>: Enlightenment Wines started out as a small, part-time farm winery in 2009 by Raphael Lyon. In 2015, Lyon reached out to <a href="https://www.linkedin.com/in/anthony-rock-14322082/">Anthony Rock</a> (a member of the Impact Angel Network) and Arley Marks with the intent to join forces and grow Enlightenment Wines into a full-scale production meadery with a tasting room and cocktail bar named Honey’s in Brooklyn New York. Since then, Enlightenment Wines has been focusing on small batch meads made with wild yeast, foraged herbs, and locally sourced fruit. These honey-based wines are dry (not sweet), barrel fermented, and released seasonally, and have been featured in the likes of <a href="https://www.gq.com/story/best-bars-america-2018">GQ</a> and <a href="https://www.newyorker.com/magazine/2017/10/16/the-magical-mead-of-honeys">The New Yorker</a>.</li><li><a href="https://limalimolodge.com/">LimaLimo Lodge</a>: Perched on the edge of the escarpment, Limalimo Lodge is a beautiful place to experience Ethiopia's Simien Mountains National Park. Combining simple luxury and elegant design in a stunning setting, the lodge promotes sustainable tourism with minimal environmental impact and provides new opportunities to the local community. The lodge has been featured in the likes of <a href="https://www.travelandleisure.com/slideshows/best-hotel-openings-worldwide">Travel + Leisure</a> and <a href="https://www.cntraveler.com/story/go-to-ethiopia-for-ancient-history-jazz-and-a-capital-city-on-the-rise">Conde Nast</a> for its minimalist-chic ambiance with staggering views. LimaLimo Lodge is owned in part by <a href="https://www.linkedin.com/in/lucas381/">Lucas Robinson</a>, a member of the Impact Angel Network.</li></ul>Interested in attending the <a href="https://www.renewcapital.com/resources/blogs/Press%20Release%20%202019%20International%20Gathering">2019 International Gathering</a>? Tickets can be purchased at the following <a href="https://www.eventbrite.com/e/renew-and-the-impact-angel-networks-2019-international-gathering-tickets-51562748569">link</a>. To learn more about sponsorship opportunities, please visit our <a href="https://www.renewcapital.com/what-we-do/investing">website</a>.<figure class="image"><img src="/uploads/sponsors_final_dd12330f28.png"></figure>

A thank you to those who are making this event possible.

sponsors_-_final.png

2019 International Gathering - Thank You to our Sponsors!

<h1 style="text-align:center;">Econ-Tourism Trips: Where Indiana Jones Meets Warren Buffett</h1>Over the years, I have hosted hundreds of investors in Ethiopia. One would think it could get monotonous, but it never does. More and more, high-net-worth individuals and families are signing up to become impact investors and choosing this as a more sustainable strategy for creating impact in Africa over more traditional charity models. Our role is to help them make good decisions and to oversee their investments on the ground. Our strategy is to find, vet and present the best small and medium enterprises (SMEs) in Africa to our growing network of global change agents, called the Impact Angel Network (IAN). Each investor has a fascinating "journey of impact" that brings them to consider the idea of investing in Africa's future. It's amazing to hear their personal stories as we walk through factories, hear pitches from women-led companies, sit with employees of companies our investors have backed, and drive around the bustling cities of Addis and Kampala.Many trip participants have "aha" moments during these visits and take another step forward in developing a new framework around Africa's economic potential for financial returns and social impact. For me, each trip we host and every story I hear brings me back to the moment I realized the future we must be part of on the continent of Africa is building the private sector. Having investors in town also provides a concentrated time for me to have my own "aha" moments over and over again. The private sector needs to keep pace with the millions of youth that are entering the workforce each year. In Sub-Saharan Africa, more than 60% of the population is under the age of 25, and around 15 to 20 million well-educated young people are expected to join the workforce every year for the next three decades (World Economic Forum, 2017). The private sector needs to grow, and grow fast, and everyone needs to take part in making this happen or all of our efforts will be swept away with rising unemployment rates. But to watch hundreds of workers making things like yogurt, bread, shoelaces, toothpicks, tee-shirts, juice...I have hope. One business at a time, we can create thousands of jobs and a thriving economy.<figure class="image"><img src="/uploads/img_e6341_animation_9d2836eddf.gif"></figure>And there is an exciting upside to this story. By 2025, it is projected that almost two-thirds of the 303 million households in Africa will have discretionary income, an addition of almost 90 million consumers in a decade. This growth is expected to push Africa’s GDP growth from 4.9% to 6.2% in the next 10 years, outpacing the global GDP rate of 3.7% (McKinsey, 2015). Smart investors are seeing the "Made in Africa" brand as the next big thing. Indigenous companies, industrious entrepreneurs, creating products with features that appeal to their domestic markets at a price-point that works with the economy; that's a great opportunity. This both gives me hope and gets me excited as an impact investor.As I walk around the companies we have invested in - I am proud to say I have backed ten companies here in Ethiopia - it's with great pride that I observe the women our companies are employing and know that each one likely supports multiple people in her household and that their living conditions are improving. She's hopefully having better access to clean water, healthcare and education because she has a job.We recently had several members of the Impact Angel Network in Addis Ababa and the time was full of good conversations and observations. During the Econ-Tourism Trip, we saw 4 portfolio and 9 pipeline companies. My partner and husband, Matthew Davis, then took several of them on to Uganda where they spent a day meeting several more companies we are considering for investment.Africa's private sector is the future. We all need to get behind it and play a role in supporting local companies grow into big ones and create millions of jobs to absorb the youth that will be entering the workforce. I encourage you all to come see what is happening here in Africa. Think different. See the future. Grow a company, build a nation and leave a legacy. This is the mission statement of the Impact Angel Network. If you are on a journey to witness firsthand and potentially invest in Africa's economic potential, we invite you to join us in Ethiopia for the next Econ-Tourism Trip October 27 - November 2, 2019.****Please note: Specific investment opportunities are made available only to “accredited investors” after completing the Impact Angel Network registration and onboarding process and following a waiting period.<hr>Sources:World Economic Forum (May 2017). The Future of Jobs and Skills in Africa. Retrieved from: <a href="http://www3.weforum.org/docs/WEF_EGW_FOJ_Africa.pdf">http://www3.weforum.org/docs/WEF_EGW_FOJ_Africa.pdf</a>McKinsey &amp; Company (July 2015). Winning in Africa’s Consumer Market. Retrieved from: <a href="https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/winning-in-africas-consumer-market">https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/winning-in-africas-consumer-market</a>

Join us for our next Econ-Tourism Trip from October 27 - November 2, 2019.

img_6901_2.jpg

Econ-Tourism Trips: Where Indiana Jones Meets Warren Buffett

<h1 style="text-align:center;">Improving Ethiopia’s Investment Profile</h1>We at RENEW join Ethiopia in celebrating the heightened attention it has received recently within the international investor and business community. The country’s liberalizing reforms are gaining momentum under the fast-moving leadership of Prime Minister Dr. Abiy Ahmed, presenting increased reason and opportunity for the rest of the world to take notice. Many have seen great economic potential in the country’s fast GDP growth, abundant natural resources, growing middle class, political and strategic importance in Sub-Saharan Africa and relative political stability. Yet, the challenges of doing business in Ethiopia have caused many U.S. and other foreign investors to be reluctant to invest in Ethiopia. We applaud the administration’s efforts to change this reality.RENEW is heavily invested in Ethiopia’s success. Our team, based primarily in Addis Ababa, facilitates angel investments into companies in Ethiopia and works with these investee companies to help them become more competitive in both international and domestic markets. We have been operating in Ethiopia since 2012 and, together with the Impact Angel Network (IAN), have become one of the most active private equity firms in the country. Since 2012, RENEW and the IAN have made twelve investments in ten companies supporting nearly 2,200 jobs, generating millions of dollars in export earnings, and supporting more than 5,700 small-holder farmers along multiple agricultural value chains. RENEW has implemented an “accelerating business growth” (ABG) program in Ethiopia in partnership with the Canadian government. We are advised by an ABG advisory group which includes prominent businessmen and government officials from Ethiopia. We have learned a lot about investing in Ethiopia from our local advisors and are very thankful for their support.Recently, we were invited by members of the Ethiopian government to report on the challenges that we are encountering when investing in the country and to suggest areas for improvement. We have had a number of fruitful discussions following up on this invitation as part of the government’s efforts to reform its investment regulatory and administrative framework to align it with recent changes in economic policy priorities. The focus of these discussions has been on the areas and recommendations outlined below:<figure class="image"><img src="/uploads/whitepaper_3c057a6ee8.jpg"><figcaption>Image Source: France 24: <a href="https://www.france24.com/en/20180730-abiy-ahmed-spreads-hope-reform-ethiopia">Abiy Ahmed: Ethiopia's first Oromo PM spreads hope of reform</a></figcaption></figure><ul><li>Restrictions on Investment Structures Commonly Used by Investors in Early Stage Companies: Investors frequently cite a lack of options for structuring their investments, particularly in early-stage companies. We recommend loosening restrictions on lending (including interest rates), considering long-term options to open the debt markets, allowing other entity types (such as a PLC) to issue preferred shares, and providing greater flexibility for small equipment leases.</li><li>Enforceability of Investment Agreements: Oftentimes, investors are nervous that their investment agreements (such as a share purchase agreement or shareholders’ agreement) will not be enforceable. We suggest clearly stating in the law that all investment agreements will be separately enforceable, in addition to companies’ memorandums and articles of association, and clearly outlining any witness or other authentication requirements for such agreements.</li><li>Frequent Regulatory Modifications: Investors express some concern that regulations will be modified unexpectedly or without explanation. To alleviate this concern, we suggest providing additional notice periods for regulatory changes so that investors can plan accordingly and seeking public commentary before final laws are published.</li><li>Delays and Uncertainty in the Process of Registering Capital: Various agencies play a role in registering foreign investments, including the EIC, NBE, MOTI and DARA. Officials at each agency sometimes provide conflicting guidance and the number of agencies can cause delays and uncertainty as to whether an investment will be reliably approved. We recommend enhancing the training of government officials responsible for registering foreign investments, streamlining the number of agencies involved, and restricting notaries’ duties to ensuring the authenticity of documents (rather than performing substantive reviews).</li><li>Repatriating Capital: Investors often fear that they will encounter significant administrative delays when trying to convert currency and repatriate capital. To ease these concerns, we recommend that the NBE publishes its track record of paying remittances and, if possible, provide a platform through which investors can track their place in the queue to repatriate dividends or capital.</li><li>Sector Restrictions on Foreign Investors: We recommend opening up additional sectors to foreign investment. Rather than having a list of defined sectors in which foreign investors can invest, we recommend a narrow list of prohibited sectors, leaving all other sectors open to foreign investment. Certain sectors could first be opened through investment by a joint venture between foreign and domestic investors, to allow for a gradual opening of the sector.</li><li>Treatment of Local Companies with Foreign Minority Shareholders as “International Companies”: Foreign investors often take a minority equity interest in a local company, in an effort to help that company compete with international players. However, we understand some companies have lost certain privileges they had as a local business due to these minority investments. We recommend abolishing any policy that favors 100% locally-owned companies over local companies which merely have a foreign minority shareholder, so as not to harm these companies and undercut the growth that the foreign investment is intending to facilitate.</li><li>Registration of Title: Providing for title registration at the municipal level can oftentimes cause delays in the operation of a company’s business, if the local office is closed or unavailable for any reason. We recommend providing for an alternative to municipal registration in an effort to alleviate delays.</li></ul> &nbsp; &nbsp;

RENEW suggests investment reforms to attract more foreign investment and business

whitepaper.jpg

Improving Ethiopia’s Investment Profile

<h1 style="text-align:center;">Press Release: RENEW &amp; the IAN Commit Capital to an All-Women Fund</h1><a href="https://renewcapital.com/sites/default/files/press_release_-_womens_package_-_final_1.pdf">Download the Full Press Release.</a>Denver, CO and Addis Ababa, Ethiopia, April 23, 2019 --RENEW and the <a href="https://www.renewcapital.com/what-we-do/investing">Impact Angel Network</a> have committed capital to a fund dedicated to investing in women-owned and led companies in Ethiopia and Uganda. RENEW and the IAN, now one of the most active investment groups in East Africa focusing on small and medium enterprises (SMEs), designed the fund to address a pressing need to close the financing gap for women-owned companies in Sub-Saharan Africa.Worldwide, only one-third of SMEs are managed by women (World Bank, 2015). In developing countries in particular, studies have shown that women-owned businesses face higher challenges to business success, especially in the area of financing. It is estimated that 70% of women-owned SMEs in emerging markets are not being properly served by the financial institutions in the area, resulting in a $285 billion financing gap. The World Bank notes that “addressing this financing gap and investing in women-owned enterprises is one of the highest-return opportunities available in emerging markets” (2015).<figure class="image"><img src="/uploads/womenspackage_dc94f294e2.jpg"></figure>The new fund will make investments in 3 to 5 women-owned companies, pending satisfactory completion of due diligence. In creating the fund, RENEW and the IAN used a new approach to address social and financial barriers holding back the private sector in Africa. The fund, which supports the <a href="https://sustainabledevelopment.un.org/?menu=1300">Sustainable Development Goals</a> (SDGs), was oversubscribed by the IAN and will support job creation for women and youth and empower women entrepreneurs in Ethiopia and Uganda."There is data that shows that despite comparative investment outcomes, female entrepreneurs are often overlooked by the business and investment communities,” said Laura Davis, Partner &amp; Head of Investor Relations at RENEW. “We hope the Impact Angel Network can show others that by investing in women-led companies we are not just advancing a social agenda, we are making sound investments.”The inspiration for the fund came after a number of the owners being considered for the fund took and excelled in RENEW’s <a href="https://www.renewcapital.com/resources/blogs/Key%20Resources%20for%20Executives">Exec’s Program</a>, a four-month business program which provides participants with the tools they need to successfully scale their businesses. All the companies currently being considered for the fund have completed or are currently participating in The Exec’s Program. “We've known the women we are planning to work with as part of this fund through our Exec's Program, and we have been impressed with their companies," explained Laura Davis.The all-women investment fund has been made possible because of RENEW’s partnership with <a href="https://www.canada.ca/en.html">Global Affairs Canada</a> (GAC). RENEW’s public-private partnership with GAC aims to support high potential, responsible SMEs in Ethiopia, providing them with the tools, resources and training they need to attract and efficiently use finance to grow, thereby enabling them to play a stronger role in the Ethiopian economy.Several of the entrepreneurs being considered for this fund will be attending RENEW’s Impact Angel Network <a href="https://www.renewcapital.com/resources/blogs/Press%20Release%20%202019%20International%20Gathering">International Gathering</a> on May 17, 2019 in Washington D.C.About the Impact Angel Network and RENEWThe Impact Angel Network is one of the most active private equity investors in Ethiopia. Its members seek to achieve both significant positive social impact and financial returns through investments in small and medium enterprises (SMEs) in Africa, a proven engine of economic growth and job creation which often lacks capital due to their size. RENEW and IAN members believe that targeting employment through SMEs is, dollar-for-dollar, is the most effective and sustainable way to reduce poverty.RENEW, with its largest office in Addis Ababa, Ethiopia, manages the IAN’s investment operations and provides investment advisory and consulting services in support of its investments. RENEW’s work in Ethiopia was piloted with USAID and is currently undertaken with financial support from the Government of Canada provided through Global Affairs Canada. The project, Accelerating Business Growth, aims at sustainable job creation for low-skilled workers, including women and young adults, through a dynamic and growing small and medium business sector in Ethiopia.To find out more, please visit <a href="../../index.html">www.renewcapital.com</a>.&nbsp;###&nbsp;Source: The World Bank, 2015: <a href="http://www.worldbank.org/en/news/feature/2015/11/16/financing-women-entrepreneurs-in-ethiopia">SME Financing: Women Entrepreneurs in Ethiopia</a>&nbsp;###

The Fund will support female entrepreneurs and job creation for women and youth in Sub-Saharan Africa

Impact Investing