Impact investor Investisseurs & Partenaires (I&P) has announced the first close of its latest flagship fund, I&P Afrique Entrepreneurs 3 (IPAE 3), raising €41 million ($47.6 million) toward its goal of €70 million. The new fund reinforces I&P’s long-term commitment to financing Africa’s “missing middle” — small to mid-sized enterprises that are too large for microfinance yet too small or risky for conventional private equity investors.
This initial close, backed entirely by leading Development Finance Institutions (DFIs), positions IPAE 3 as one of the most strategically designed impact vehicles in Africa’s SME financing landscape. Among the investors are the European Investment Bank (EIB), the West African Development Bank (BOAD), Bpifrance, and Proparco, the latter investing through its FISEA initiative.
A Fund Designed for Difficult Markets
A key feature of IPAE 3 is its de-risking structure, which includes a €7 million junior catalytic tranche provided by FISEA with support from the EU’s EFSD+ program. This first-loss capital acts as a cushion for future investors, making the fund more attractive to private institutions and risk-sensitive stakeholders. The mechanism is intended to help funnel more capital into markets that traditional financiers often view as too volatile.
Alongside the investment capital, IPAE 3 will be supported by a €1.2 million technical assistance facility. Funded by the French Ministry for Europe and Foreign Affairs and the European Union, this facility will enable portfolio companies to access operational experts, ESG consultants, climate advisors, and tailored training as they scale their businesses.
A Proven Model with Local Depth
The new fund builds upon the foundation laid by IPAE 1 (2012) and IPAE 2 (2017), two vehicles that together backed 56 SMEs, deployed €146 million, and completed 17 exits. Nearly 68% of those companies operate in fragile or least-developed markets, underscoring I&P’s appetite for frontier economies.
IPAE 3’s investment strategy mirrors the firm’s established philosophy: backing 15–20 SMEs with minority equity or quasi-equity tickets of €1 million to €5 million. The geographic focus remains firmly on West Africa and Madagascar, where I&P has built local teams capable of close engagement with founders, hands-on portfolio support, and real-time market insights.
The sectors targeted reflect essential economic needs, including agriculture and agro-industry, healthcare, education, energy, financial services, logistics, and light manufacturing.
Gender and Climate at the Core
I&P has embedded two impact pillars into IPAE 3:
- Gender inclusion: At least 30% of portfolio companies are expected to be women-led or women-owned, aligning the fund with the global 2X Challenge standard.
- Climate action: Each investment will undergo structured climate due diligence, with a goal of achieving at least 15% decoupling between revenue growth and emissions.
The fund also expects 60% of its portfolio to contribute directly to climate mitigation or adaptation — positioning IPAE 3 as a catalyst for resilience in vulnerable markets.
Looking Ahead to 2026
With the first close secured, I&P will now begin deploying capital while simultaneously preparing for additional fundraising. Due diligence with new potential investors is already under way, with the final close planned for late 2026.
For many African SMEs navigating a widening financing gap, IPAE 3 represents more than a capital pool — it is a long-term partner equipped with funding, technical support, and a continent-wide presence. I&P’s continued momentum signals growing confidence in Africa’s entrepreneurial fabric and the role of catalytic capital in unlocking long-term economic and social value.
