Silk Invest is a private equity firm founded in 2008 that invests in emerging markets that demonstrate the potential for long-term economic growth. The largest private equity fund managed by the firm is called The Silk Africa Food Fund. Investments made from this fund target companies involved in food processing and distribution throughout Africa.
The Silk Africa Food Fund
The fund was started in June 2012 and focuses primarily on businesses that distribute food to African consumers. Countries that attract investment the most are those which are institutionally and politically stable enough to support long-term economic growth. Silk Invest is distinct from many other foreign investment funds that support the effort to reduce hunger in Africa in that it does not target agriculture but rather the distribution of food to consumers.
The three largest investments the fund is involved with are Nigeria’s Sundry Foods Limited, Ethiopia’s Nas Foods Plc and Egypt’s El Rashidy El Asly. Of these three, Nigeria’s Sundry has seen the most significant success and expansion following its partnership with Silk Invest.
The Success of Sundry Foods Limited
The company runs the popular restaurant chain, Kilimanjaro, as well as bakery and food catering services throughout the country. When Silk Invest first gave funds to Sundry in 2012, the company had seven restaurants open and a revenue base of around $3.4 million. In 2020, just eight years later, Sundry has 40 restaurants and a revenue base of around $34 million. The entrepreneurial effort of the company’s founder, Ebele Enunwa, has been instrumental in this progress.
Sundry is a company firmly rooted in supporting its fellow local businesses. Instead of setting up in the more commercial capital of Lagos, Enunwa established headquarters in Port Harcourt where he is a local entrepreneur. Its management team consists of local hires and its supply chain uses locally sourced raw materials, including chicken and rice from rural areas.
Sundry’s Impact and Potential
Sundry Foods Limited represents an example of the enormous potential which exists for businesses in developing nations when the proper investment is made. By providing capital to Sundry, Silk Invest gave the company the tools it needed to expand its operation. By doing so, Sundry has not only offered an improved service to consumers throughout Nigeria but has also stimulated its broader community’s own economy by maintaining a steady and even increasing demand for local products.
The impact made by Sundry’s growth is palpable. Over the last 10 years, the company has created over 2,000 jobs. Silk Invest’s Africa Food Fund is hugely impactful in the effort to reduce poverty in developing nations not only because of the direct benefit the invested capital provides to individual businesses but also because of the economic growth created in broader communities as an indirect result.
The Importance of Investing in Africa
This impressive progress was all stimulated by a $2.4 million investment. The high return for Silk Invest demonstrates that funding businesses in developing countries is not only beneficial to the growth and development of those businesses but is also a practical and sound investment for the firms offering the capital.
Investing in the effort to reduce world hunger presents impactful and beneficial opportunities for all parties involved. By establishing the Africa Food Fund, Silk Invest has committed itself to this effort while simultaneously supporting developing economies.
– Haroun Siddiqui