Medium-Sized Enterprise Investment

Our Special Interests

While our scope is sector agnostic, we have special interest in selected sectors. The preferred sectors are based on potential for systemic impact, value creation and alignment with our team’s areas of expertise.

Value-added Agribusiness

With 60% of the world’s arable land, SSA has realistic potential to be a leading global “breadbasket”.
As sector infrastructure is highly underdeveloped and investments in manufacturing remain low, much of SSA still relies on high levels of import for food security.
Although local value-added activity in the arena is increasing, opportunities for new entrants with capacity for scale remain vast.
Yaro’s focused sector interest is in the manufacturing and value-added services segments, including technology and device-based innovations.
The agribusiness sector in the region is projected to have a market size of approx. USD$1 trillion by 2030 and arguably offers the biggest opportunities for economic-scale companies in SSA to achieve and sustain market leadership.

Healthcare

Rising rates of both infectious and non-communicable diseases and underdeveloped health delivery infrastructure offer unusual opportunities for profitable interventions.
According to an IFC report, healthcare in Africa remains the worst in the world.
As further illustration of opportunities, various estimates indicate that out of the USD$50bn spent annually on medicines and vaccines in the region, only about 1% goes to local manufacturers.
Most pharmaceuticals are imported, with estimates ranging from 70% to 94%. The situation with medical devices is not different.
Opportunities for superior value creation through innovation and local manufacturing, are thus sizable. Yaro’s interest includes the areas of health delivery systems, medical devices, pharmaceuticals, diagnostic and testing services.

ICT

It is acknowledged that Africa lags the rest of the world in terms of reach and quality of ICT penetration, and it is estimated that there is an investment deficit of approximately US$3 billion annually to address the lag.
In SSA, ICT products such as supply chain management systems, enterprise software (e.g., CRM), and digital payments remain significantly underpenetrated.
Within the broad sector, our area of interest is “enabling ICT”, specifically including enterprise productivity systems, such as enterprise resource planning (ERP), customer relationship management (CRM), payment systems, supply chain, and telecom support services.
Africa’s enterprise software market alone is expected to expand at a compound annual growth rate of roughly 6.3 percent to reach around US$5.3 billion by 2030.

Financial Services

Despite the recent surge in fintech activity, access to financial products and services remain among the lowest in the world, both for individuals and businesses.
While fintech is one of the fastest-growing startup sectors in SSA, overall penetration of digital financial services remains about 5–6% of the financial services market (compared to 15%+ globally).
Yaro’s sector interest is in innovative nonbank financial services and technology that will provide digital services for a broad and growing customer base.
In 2020, the region’s financial services market was projected to expand by about 10% per annum, reaching roughly $150 billion in revenues by 2025

Cleantech

To accommodate high population growth rates and mitigate adverse climate change impact, governments and private sector institutions in the region increasingly recognize the need for “clean technologies” in general.
Power is by far the region’s largest infrastructure challenge, with about 600 million people in SSA not having access to electricity and more than 400 million lacking basic water and sanitation services.
The population of Africa is estimated to grow to 2.5 billion by 2050 and current fossil-fuel sources alone would be unable to supply the projected demand and needs for economic development.
With falling technology costs and more supportive regional and national policies, cleantech offers opportunities to deliver both strong financial returns and lasting social impact.
Yaro’s interests in the sector are the growing opportunities for companies with innovative technologies and business models focused on decentralized energy systems.