**Table 4: Representative VC and Impact Investors Active in Kenya**

||**Venture Capial and Impact Investors**<br>||
|---|---|---|
|**Venture Capital**|**Impact I**|<br>**nvestment**|
|Venture Capital Funds|Regional Funds|Global Funds|
|Novastar Ventures|Grofin Africa<br>Mango Fund|Acument Fund<br>Grassroots Business Fund|
|Seed Funds and Accelerators|SEAF INVEST East Africa||
|Safaricom Spark Ventures|ResponsAbility|Family Offices|
|Merck Accelerator||Lundin Foundation|
|Savvanah Fund||DOB Equity<br>Blue Haven Initiative|

_Source: Primary Research_ Impact investment firms typically invest less than US$5 million and focus on SMEs. They are distinct, however, in that they are willing to forego purely commercial returns to generate social and environmental impact alongside a financial return. Impact investment firms active in Kenya operate globally (e.g. Grassroots Business Fund, Acumen) or regionally (e.g. BPI East Africa, GroFin Africa, SEAF INVEST East Africa), and often have a technical assistance component as well. For example, the SEAF INVEST East Africa Fund, an agribusiness focused fund that seeks to promote intra-regional trade in East Africa, features a pre- and post-investment technical assistance facility funded by the US Agency for International Development (USAID) and MEDA.<sup>9</sup> In addition to impact investment funds, family offices such as Blue Haven Initiative, which hails from the United States; Lundin Foundation, a Canadian Foundation affiliated with the Lundin Group of Companies; and DOB Equity, a family office from Holland, are active in the space.

Acumen Fund provides a well-established case study of a long-standing participant in the East African impact investment space. The firm has been present in Kenya for a decade and started off making grants before moving into equity investing. It invests in agriculture, housing, power, and education, and has deployed over US$40 million into nearly 40 companies, typically in checks of US$250,000 to US$2.5 million. The firm’s investments seek to bring transformational change to established industries in order to make those industries work better. They also create employment – Acumen’s companies have created nearly 50,000 jobs in East Africa, of which more than 50 percent are in Kenya. As with some private equity funds such as AfricInvest, which raise industry funds, Acumen has chosen to invest via thematic funds, including: (i) Acumen Fund, which provides grants to support early stage and high-risk companies, (ii) Acumen Capital Markets I, which focused on proven technology and impact opportunities, and (iii) the Acumen Energy Fund. Although Acumen used to predominantly invest via debt structures, as the market has matured, the firm has adapted its style to favor equity or quasi-equity instruments.

There has been some convergence between the impact investment, early stage (VC) seed fund and SME private equity spaces over the last several years, considering the SME-centric nature of the Kenyan PEVC market. As there are funds of all kinds active in East Africa, the best companies attract interest from and are able to choose among SME private equity funds and impact funds. Acumen, for instance, has helped to drive this convergence between private equity and impact. As noted, the firm started out by providing grants

> 9 MEDA website. http://meda.org/fr/about-meda, accessed June 11, 2017.

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