Impact investing as a new approach to development in Africa

Impact investing is now emerging as a new approach to international development, offering the promise of long-term sustainability. [iStockphoto]

Investments in African startups keep growing at a rapid pace, ever since data from the sub-sector was first collected in the mid-2010s. According to The Landscape for Social Investments: Sub-Saharan Africa Comparative Analysis report released by Intellecap Advisory Services in 2020, there were over 820 social investors active in East, West, and Southern Africa.

Compared to the amount of investment raised by high-growth US-based startups and unicorns, the amount is quite small. However, despite the disparity, the fact remains that more money is flowing into Africa.