Private equity asset manager, Apis Partners, has announced that they have raised over $157 million in commitments for their inaugural Apis Growth Fund. With the funding, Apis will be targeting financial services and fintech investments in Africa and South Asia. Specifically, Apis will be seeking to fund firms that “well placed to benefit from favourable demographic and macro-economic fundamentals as well as structural supply/demand gaps in the growth markets of Africa and South Asia”.
According to Apis, commitments of funding include institutional investors and developmental finance institutions from the US, Europe and Africa. Individual investors in the fund include Intesa Sanpaolo,Old Mutual, the European Investment Bank, FMO (Netherlands) and Swedfund (Sweden).
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The new fund adds more capital to a market where valuations of financial technology innovation startups have been rising steadily over the past three years. Specifically the P2P lending and payments have seen a boost of entrants and investments as newcomers grab market share away from traditional banks and money transfer firms. While entering a crowded market of overall investments, Apis is distinguishing itself by focusing on Africa and South Asia, instead of the typical US and European markets targeted by investors.
In regards to targeting emerging market investments, Apis Co-Founder and Managing Partner, Matteo Stefanel stated “We strongly believe that the next wave of business-model innovation in financial services will come from growth markets. As incomes in these markets continue to rise, so will the demand for formal financial services, representing a unique opportunity for entrepreneurs creating innovative and cost-effective solutions.” Stefanel added “We aim to back those entrepreneurs”.
In regards to the added potentials of providing services in areas without established financial networks and large unbanked population, Apis Co-Founder and Managing Partner, Udayan Goyal explained “Of the 2.5 billion unbanked adults globally (over half of the world’s adults), 2.2 billion reside in growth markets. Financial inclusion has a direct, measurable impact on GDP growth as well as offering an enormous, untapped market, expanding further thanks to the confluence of demographic and macroeconomic growth factors. We are firmly convinced that Financial Services will deliver in the next decade the same level of return on investment as the telecom boom of Africa and South Asia of the last two decades: we aim to bring that opportunity to our investors.”