MICROCAPITAL BRIEF: Sanad, Aavishkaar, Uncovered Participate in $4m Equity Raise by Sky.Garden of Kenya to Expand Its Digital Marketplace to Middle East, North Africa

The Luxembourg-domiciled Sanad Fund for MSME recently led a Series A investment in Sky.Garden, a Kenya-based e-commerce platform serving 15,000 micro-, small and medium-sized enterprises (MSMEs). Sky.Garden plans to use the fresh USD 4 million to expand into the Middle East and North Africa (MENA), especially Egypt. Sanad invested half of the total, with additional participation from angel investors and two venture capital funds, India-based Aavishkaar Capital and Uncovered Fund, which is based in Japan and has offices in Kenya, Nigeria and South Africa. The sizes of the stakes taken by the investors remains undisclosed.

Sanad Board Chair Dr Daniela Beckmann said, “Sanad has long promoted the power of technology for financial inclusion and business growth, and the pandemic has underscored the importance of digital solutions in ensuring flexible, sustainable operations for entrepreneurs. With an investment into Sky.Garden, we will also enable technology transfer for the benefit of entrepreneurs in the MENA region.”

Founded in 2015, Sky.Garden provides MSMEs with customizable web pages and software for managing inventory, receiving payments, coordinating shipping and otherwise serving customers remotely, such as to comply with COVID-19 pandemic restrictions.

Sanad, which means “support” in Arabic, was founded in 2011 by German development bank Kreditanstalt für Wiederaufbau (KfW). The fund makes equity and debt investments in organizations that support MSMEs such as microfinance institutions, leasing companies, banks and firms that facilitate access to markets. Sanad invests across the Middle East and North Africa with an emphasis on Egypt and Tunisia. Its investors are US-based Calvert Impact Capital; the EU; Germany’s GLS Bank; and development finance institutions of the Austrian, Dutch, German and Swiss governments. As of 2020, Sanad had an outstanding debt portfolio of USD 232 million. It is advised by Germany’s Finance in Motion, which manages assets valued at EUR 2.5 billion (USD 2.7 billion), also as of 2020.

By Sophie Fiala, Research Associate

Sources and Additional Resources

Sanad press release
https://sanad.lu/latest-updates/sanad-helps-african-entrepreneurs-go-online-with-investment-of-usd-2-million-into-tech-startup-skygarden

Sky.Garden homepage
https://sky.garden/

Aavishkaar Capital homepage
https://aavishkaarcapital.in/

Uncovered Fund homepage
https://en.uncoveredfund.com/

Previous MicroCapital article on SANAD
https://www.microcapital.org/microcapital-brief-amen-bank-of-tunisia-borrows-17m-from-sanad-for-on-lending-to-msmes-adjusting-to-covid-19-pandemic/

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