Alitheia Capital and Goodwell Investments have announced their first exit from the jointly managed uMunthu Fund, successfully concluding a 12-year investment journey with Baobab Nigeria. This exit showcases the remarkable growth and resilience of Baobab Nigeria, a financial institution dedicated to providing inclusive banking services to underserved individuals and Micro, Small, and Medium-sized Enterprises (MSMEs) across sub-Saharan Africa.
Baobab Nigeria’s transformation from a modest operation in Kaduna State into one of Nigeria’s top-three nationally licensed microfinance banks illustrates the profound impact of patient capital and strategic partnership. What began as a regional network of five branches serving approximately 19,000 customers in 2012 has expanded to a national network of 38 branches, reaching 230,000 customers across 16 states.
The journey was driven by Alitheia and Goodwell’s commitment to fostering inclusive financial growth. Their support encompassed professionalizing Baobab’s governance structure, enhancing financial structuring, and providing access to local networks and expertise. This comprehensive approach enabled Baobab Nigeria to scale from a unit microfinance institution (MFI) to a top-tier national MFI, cementing its place as a leader in financial inclusion in Nigeria.
Throughout this period of accelerated growth, Baobab Nigeria remained committed to its core mission of providing affordable financial services to underserved communities. Notably, the institution maintained modest average loan and deposit sizes of NGN 2 million (EUR 1,250) and NGN 91,000 (EUR 58), respectively, ensuring accessibility for low-income individuals and small business owners.
From the outset, Alitheia Capital and Goodwell Investments demonstrated the importance of local expertise and hands-on support. They were the first local private capital investors actively involved in Baobab Nigeria, a market previously dominated by Development Finance Institutions (DFIs). Their involvement not only contributed to financial growth but also helped Baobab Nigeria expand into areas of northern Nigeria where financial services were critically lacking.
Over the years, Baobab’s balance sheet grew by 37 times, while its loan book size expanded by 43.5 times. The financial value of uMunthu’s investment in Baobab Nigeria tripled in naira terms, proving that impact-driven investing can simultaneously yield impressive financial returns and contribute positively to social development.
Alitheia Capital Managing Partner Tokunboh Ishmael reflected on the journey, stating, “This was a bank operating out of a single room in northern Nigeria when we invested. Today, it stands as a top-three nationally licensed microfinance bank. We’ve walked a journey of leadership, governance, and impactful growth, scaling from humble beginnings to become a leader in inclusive financial services. We’re proud of what we’ve achieved together and look forward to seeing where the future will take Baobab Nigeria.”
As Baobab Nigeria transitions to being fully owned by the international Baobab Group, it plans to continue its commitment to providing scalable and inclusive financial services to underserved communities. The exit underscores the potential for private capital to drive sustainable growth in emerging markets.
Meanwhile, Alitheia Capital and Goodwell Investments are optimistic about their future investments under the uMunthu II Fund, which is currently in its final fundraising phase. They continue to seek investors interested in replicating the success demonstrated through their Baobab Nigeria investment.
For more information and interview requests, please contact:
Liz Keel, Marketing Communications Manager at Goodwell (liz@goodwell.nl)
About Goodwell Investments:
Goodwell Investments is a pioneering impact investment firm focused on promoting inclusive growth by providing early-stage equity to high-impact businesses across underserved communities in Africa and India. Since 2009, Goodwell has partnered with Alitheia Capital to identify and manage investments in West Africa, including the uMunthu II Fund, a EUR 150 million fund aimed at expanding their impact footprint. Visit: www.goodwell.nl
About Alitheia Capital:
Established in 2007, Alitheia Capital is an impact investment firm based in Lagos, Nigeria, dedicated to supporting high-growth, high-impact businesses across West Africa. It focuses on financial inclusion, gender-lens investing, and fostering inclusive economic growth.
