Investors adopt venture loan and royalty based schemes as solutions to the divestiture and liquidity problems in the emerging economies. Multiple issues impact the investment strategy, one being the organizational structure: Should execution be assigned to staff responsible for other investment products (e.g., term loans, credits, guarantees, equity), or should it be implemented as a distinct product, with its own marketing program and separate investment staff? Each alternative has advantages and disadvantages, and each impacts decision making, management control and staff autonomy differently.
IVI executed this program in the design, creation and implementation of the African Enterprise Fund, the International Finance Corporation (IFC) for investment into the countries of Sub-Saharan Africa (SSA). The Fund was capitalized with $280MM, money raised from IFC managed trust funds + others. IVI provided strategic direction and management to guide program execution into SSA including:
- Execution and organization alternatives
- Means of achieving ROI objectives
- Client profiles for investment
- Cost of capital and impact of legal systems in African countries like French practices on deal structures and mix among investment products, threats to repatriating cash flow returns and solutions
- Selection and training of investment officers
- Securitize assets with IVI’s ‘Silent Lien.™’ This solution collateralizes intellectual assets to provide financial security in SME investees rich in technology but hard asset poor.
- Investments made in industries/markets serving mainstream needs in SSA; wholesaling, retailing, food and beverage, fast moving consumer goods, construction materials/services, medical/dental clinics and services as examples. Investment amounts ranged from $250k-$5MM/SME; portfolio of 97 investments.
“Consider IVI as your investment advisor and partner in planning and executing international private equity schemes. We can help you avoid the learning curve costs that skilled investors inadvertently incur when executing new investment programs.”