Nigerian entrepreneur Adesuwa Okunbo Rhodes has made a major impact in the venture capital industry with the successful close of her company, Aruwa Capital’s first institutional fund.
Rhodes founded Aruwa Capital, a Lagos based, female-founded and led, growth-equity, impact investment company in 2019 with the goal of closing the investment gap affecting women-owned businesses in Africa.
The investment firm recently surpassed its $20-million target, making Rhodes the youngest solo general partner to raise a $20 million fund in Nigeria at the age of 32. The Visa Foundation and the MasterCard Foundation Africa Growth Fund were among the top contributors to the fund.
Despite accounting for 40 percent of small and medium-sized enterprises (SMEs), women-led businesses only receive about one percent of investment. In order to address this disparity, Rhodes sought to create more women-led investment companies, including venture capital and private equity firms, to provide finance for women-led businesses.
Aruwa Capital plans to invest between $500,000 and $2.5 million in companies run by and geared toward women in Ghana and Nigeria.
It has already made investments in six businesses, including healthcare firms Wemy Industries and Lifestores Healthcare, fintech start-ups PngMe and Crowdforce, cleantech company Koolboks, and consumer goods company Agroeknor.
The investment firm serves as a link between venture capital and private equity, investing in low-risk companies that have already demonstrated the viability of their business models but are too small for most local private equity firms.
These enterprises are prepared to scale with an investment of between $1 and $2 million. In addition, Aruwa Capital takes a gender lens approach, investing in the female economy and supporting female-led and -focused firms in order to close the gender gap for female entrepreneurs.
Rhodes’ success with Aruwa Capital highlights the importance of increasing the number of women-led investment firms in order to close the funding gap for women-owned businesses. It also showcases the potential for local capital to play a crucial role in supporting and investing in these businesses.
