Small Foundation makes strategic investment in Impactable
Small Foundation has made a strategic equity investment in Impactable Investment Group, a London-based fund manager focused on finance-first, impact-driven investments across emerging markets.
This investment will equip Impactable with critical runway to reach first close on its Emerging Markets Private Debt Fund, which will provide senior secured debt to SMEs and financial institutions through both direct lending and co-investments. The fund will invest across key sectors driving green inclusive growth – including financial services, renewable energy, agriculture, healthcare, education, green transport, and water. These investments will deliver impact through three primary channels: economic wellbeing, resilient communities, and accelerating the climate and energy transition.
The strategic collaboration with Small Foundation not only validates our approach of delivering competitive returns while driving meaningful social and environmental outcomes, but also empowers us to accelerate the development of resilient, inclusive capital markets. Together, we aim to unlock new opportunities for SMEs and communities, fostering sustainable growth and addressing some of the most pressing challenges of our time.
– Chris Kuchanny, CEO, Impactable Investment Group
Impactable’s Emerging Market Private Debt Fund addresses critical challenges including:
- Significant SDG funding gaps related to financial inclusion and climate
- 1.7 billion people without access to financial services
- Millions of MSMEs in need of capital
- Increasing CO₂ emissions in emerging markets
- Growing poverty due to climate change impacts
Impactable’s strategy directly tackles four key challenges in impact investing:
- Delivering high impact with competitive returns: Positively impacting lives at the bottom of the pyramid while taking a financial-first approach, with return enhancements from selective secondary debt positions.
- Managing risk while investing at scale: Through diversification and principal protection solutions, the fund aims to minimise drawdowns while providing significant investment capacity.
- Catalysing capital through innovative structures: Utilising a first-loss capital structure provided by foundations and development finance institutions, which absorbs initial losses at the portfolio level. This structure enables principal protection through insurance products, making the investment more attractive to institutional investors.
- Multiplying impact through co-investment: Allowing investors to benefit from the strong track records of leading emerging market investors with decades of experience, enabling investment at institutional quality and scale.
Impactable additionally plans to raise a private equity secondaries fund, targeting private equity Limited Partner (LP) and investee secondaries to strengthen capital recycling and liquidity in emerging markets.
Small Foundation’s investment serves as an initial catalyst. However, creating a transformative impact vehicle requires additional partners. We invite other catalytic investors to join us in supporting Impactable’s vision of building stronger, more liquid capital markets in Africa and other emerging regions.
At Small Foundation, we look for partners who share our vision of building more resilient and inclusive capital markets in Africa. Impactable’s strategy, combining strong impact with smart, scalable structures aligns perfectly with this. Our investment is not just about capital; it’s about catalysing broader participation from global investors to unlock real, lasting change across emerging markets.
-Karina Wong, Head of Investments at Small Foundation
For Small Foundation, this investment complements our work with fund managers by ensuring that viable exit options exist as their portfolio companies grow, creating a more resilient and functional capital market that can serve SMEs across the growth spectrum.
