Africa Enterprise Challenge Fund (AECF) supports businesses working in agriculture, financial services, renewable energy, and technologies for adapting to climate change in all countries of Africa. The Africa Enterprise Challenge Fund is a US$50-100m private sector fund, backed by some of the biggest names in development finance and hosted by the Alliance for a Green Revolution in Africa (AGRA).
AGRA is an alliance jointly created in 2006 by The Rockefeller Foundation and the Bill & Melinda Gates Foundation aimed at improving agricultural productivity and small holder farmer well-being throughout sub-Saharan Africa. AGRA is registered as a non-profit entity in the United States, but operates out of Nairobi, Kenya, where it is registered as the branch of a foreign corporate entity. From Kenya, AGRA is managing programs supporting agricultural development across sub-Saharan Africa. The AECF is a special partnership initiative of AGRA that supports AGRA's mission.
Who funds The AECF?
The Australian Government Aid Program, the Consultative Group to Assist the Poor (CGAP), the UK Department for International Development (DFID), the International Fund for Agricultural Development (IFAD), and the Netherlands Ministry of Foreign Affairs (NMFA) are the current funders of the AECF. Others may join in due course.
AECF Fund Manager (FM) –
KPMG Development Advisory Services (AECF Director, Hugh Scott). KPMG DAS was awarded the contract to manage the AECF following a competitive tender, in association with Triple Line Consulting (TLC) and Imani Development Group. Additional support is provided by Creative Squares Ltd (West Africa hub), Acumen Africa Consulting (Zimbabwe) , the Springfield Centre for Business in Development (advisory), SBA Consulting (East Africa Hub) and Y&R Brands (marketing and communications). The FM is responsible for the day to day operations of the Fund, from its HQ offices in Nairobi including:
AECF has two calls for applications now.
(i) REACT Round-1 offers grants and repayable grants of up to US$1.5 million to for-profit companies for business ideas in low-cost and clean energy and technologies for adapting to climate change in the East African Community -- Burundi, Kenya, Rwanda, Tanzania, and Uganda.
(ii) TZAW Round-1 offer grants and repayable grants of up to US$1 million to for-profit companies for ideas in agribusiness and value chains which extend from rural Tanzania to local and international markets.
The AECF is open to proposals from all countries in Africa. Multi-country and regional projects are also eligible.
The closing date for applications is 31 January 2011
The Africa Enterprise Challenge Fund, Equatorial Fidelity Centre, 3rd Floor, Waiyaki Way, Nairobi, P O Box 13459-00100 GPO / Phone: +254 20 2699137 / 8 / 9
For more info or clarification go through the attached FAQ and ask to skf NGO funding consultants (if your NGO is already registered in skf NGO directory, or click here to register it now) or contact to office of The Africa Enterprise Challenge Fund.
The NGO Funding Consultants
SUDESH KUMAR FOUNDATION
I submitted an application(s) in an earlier round(s) but did not win. Can I re-submit my proposal in future rounds? Yes, as many times as you wish, but you need to make sure that you are eligible for the special criteria of any given funding window. Say, for example, your project is a media service targeted at rural people and you competed in Round 1 of the Zimbabwe window. You can re-submit to the Research Into Business window, BUT only if your concept has a clear and meaningful link to agricultural research. Otherwise it will be eliminated straight away.
I do not understand the Financial section of the application form. How does it work?
To be eligible for AECF funding you must enter both the amount of grant requested and the amount of repayable grant requested, even if one of them is zero;
a) Grant Request (enter 0 if no grant is needed)
b) Repayable Grant Request (enter 0 if no repayable grant is needed)
The Total amount (a + b) cannot be less than US$ 250,000 or more than US$ 1,500,000. The total is an automatically calculated field on the online form. You should not try to update this field.
The minimum amount the AECF requires your company to invest is usually 50% (at least, the more the better) of the total cost of implementing the project. However you must check the particular conditions for the particular window you are applying to. For the Fragile States Window (not currently running) the amount required was lowered to 50%; also for Zimbabwe Window rounds. It is up to you to check this.
The Tanzania Agribusiness Window (TZAW) offers a maximum support of US $1.0 million only and a minimum of US $ 100,000/=
What counts as my company's contribution?
Mainly, new money. Your share of the total funding may come as debt (borrowing) or equity (cash injection), by yourself or by another partner(s). In principle AECF will not recognize the contribution of existing fixed assets such as land and buildings or of sunk costs, however important these may be to the success of the project.
On the Proposal Process page, it says I need to invest funds in cash or 'kind'. What does this mean?
This means that your company can contribute resources to the project both in terms of cash and in terms of other inputs such as staff and equipment etc. If you intend to contribute to the project using "in-kind" resources please specify on the application form what these will be. Note that overhead costs such as senior staff salaries which would have to be paid anyway may be difficult to justify, unless a substantial part of their time is to be diverted to the project. However, our experience has shown that it is difficult to lay down absolutely hard and fast rules on this question. If in doubt, ask.
What is the maximum amount I can ask the AECF to contribute? What is the minimum? As above, the amount applied for cannot be less than US$ 250,000 (minimum) or more than US$ 1,500,000 (maximum).
What is a repayable grant?
It is effectively a zero interest rate loan repayable over the life of the project
What is the AECF's recommended Ratio between Grants and Repayable Grants?
The AECF is looking for leverage but does not stipulate any particular ratio. In general, however, the less risky a project, the more it should be able to bear the burden of repayment – that is, to have a higher repayable element. Conversely, very innovative, higher risk projects might prudently reduce their leverage. All other things being equal, projects with a higher proportion of repayable grants will be assessed more positively, provided they score well on the selection criteria outlined on the "Proposal Process". This consideration should be seen more as a tie-breaker than a crucial criterion. It is for you to decide how much risk you can take.
Where does my company have to be based and/or registered for me to apply?
It does not matter where your company is based or registered. All that matters is that the beneficiaries of the project will be people living in the rural areas in Africa. For example, the applicant company could be based in Europe or India, as long as its project supports the rural areas in countries in Africa.
Can I apply if I have a startup business or it is less than 2 years old?
In normal circumstances your company must be able to produce 2 years of audited accounts. We will ask to see these at the second, business plan, stage of the competition. However, the AECF is able to make exceptions to this rule where there is clear evidence that the new company has the capacity, experience and resources to implement the project.
Can I apply if I am a not for profit company or NGO?
No. The legal obligations of the AECF mean your organization must be a for-profit company, or other such entity.
Can I apply for more than one grant or loan?
Each application can only be for one project. However, you may submit separate application forms for as many different business ideas/projects as you wish.
What are my chances of winning?
The AECF operates like a "social" venture capital fund – seeking and engaging with many potential projects and companies to find those with the greatest rate of return against the our objectives. We anticipate that no more than one in ten projects will be awarded funds. (The response to Rounds 1 and 2 of the competition was so large that only about one in 30 projects actually received funds).
Does my company have to contribute?
Successful applicants are expected to contribute a minimum of 50% of the total cost of the project, unless otherwise stipulated. Businesses that are willing/ able to contribute greater than the 50% minimum are more likely to receive AECF support as we wish to leverage our funds.
How long does the approval process take?
Funding approval for successful applications will be granted within a maximum of 150 days from the closing date for applications.
The NGO Funding Consultants
SUDESH KUMAR FOUNDATION
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