Aruwa Raises $35m, Hits 90% Of Its Fund II Target At Second Close

Mary Nnah

Aruwa Capital Management, a Lagos based female founded and led early stage growth equity and gender lens fund manager, has raised 90% towards its $40 million target for its second fund, Aruwa Capital Fund II. Aruwa Capital is doubling down on its proven investment strategy, backing high-growth, impact-driven businesses that are transforming key industries in Nigeria and Ghana.

This milestone surpasses the total fund size of Aruwa Capital Fund I which closed in 2022 at just over $20 million. Fund II has attracted investment from returning LPs including the Mastercard Foundation Africa Growth Fund (MFAGF), Visa Foundation, global family offices and HNIs, and new LPs such as Bank of Industry (BOI), Nigeria’s oldest and largest Development Finance Institution (DFI), and international investors such as British International Investment (BII), the UK’s development finance institution and impact investor and EDFI Management Company, through its European Union funded Electrification Financing Initiative (ElectriFI).

With this encouraging progress, Aruwa is on track to upsize its targeted size from $40 million to $50 million (with a hard cap of US$60 million) within this year, on boarding more global institutional investors.
By focusing on essential sectors such as healthcare, energy access, financial services, and consumer staples like food and agribusiness, Aruwa is not just deploying capital but actively shaping Africa’s economic future through an intentional gender-lens investing approach.

With initial ticket sizes ranging from $1 million to $3 million, Fund II is already off to a strong start with two (2) completed investments: Yikodeen, a pioneering indigenous manufacturer of safety boots, and a rapidly growing fast-casual dining restaurant chain in Nigeria, both positioned for improving economic opportunities for women and supporting inclusive growth.

The entrepreneurs supported by Fund I have amassed significant traction in recent years with total revenues across its portfolio of 11 companies growing on average 22x since investment (in local currency). Across both funds today, over 200,000 direct & indirect jobs are being supported and in line with our gender lens focus, 73% of companies backed under Fund I are founded or led
by women.

In addition, Fund I’s portfolio companies have successfully raised substantial capital in followon rounds, attracting larger strategic and financial investors. On average, these follow-on investments were made at valuations approximately 7x higher than Aruwa’s initial investment,
underscoring Aruwa’s ability to identify high-potential businesses early whilst also showcasing the value add that Aruwa brings to its portfolio companies.
Commenting on this, Dorothy Nyambi, President & CEO, MEDA (Fund Manager, The Mastercard Foundation Africa Growth Fund: “Aruwa Capital’s momentum is a powerful reminder of catalytic effect of what’s possible when we invest with intention and equity. At MEDA, we’re proud to be part of Fund I and now stand alongside Fund II as an anchor investor.

Aruwa is creating employment opportunities at scale for Africa’s youth! Over 200,000 jobs impacted is just the beginning. Together, let us continue to shape the future job market that Africa’s youth not only need but deserve.”Dr. Olasupo Olusi, Managing Director at Bank of Industry (BOI) said: “We are proud to be the
first local institutional investor in Aruwa’s second fund. Aruwa has consistently demonstrated a strong track record in bridging SME funding gaps and catalyzing both local and international capital.
We look forward to a productive partnership with their team and portfolio companies.”
Rodrigo Madrazo, CEO of EDFI Management Company said: “We are delighted to support Aruwa Capital in advancing renewable energy access solutions in Nigeria through Fund II.

Thanks to catalytic funding from the European Union, this partnership reflects our shared commitment to accelerating the clean energy transition while fostering inclusive economic growth. Aruwa’s gender-lens investment approach ensures that women are prioritized in the green economy, and we are excited to collaborate in scaling innovative, climate-resilient businesses that create jobs
and expand access to sustainable energy.”

Benson Adenuga, Coverage Director and Head of Nigeria Office at British International Investment (BII) said: “We are delighted to be the first international development finance institution supporting Aruwa for its efforts in catalysing the West African early-stage investing ecosystem. Aruwa is well positioned to bridge the early-stage funding gap, particularly for women entrepreneurs in Nigeria and Ghana. Their gender-lens investment approach aligns with BII’s commitment to fostering inclusive economic growth while mobilising more institutional capital.”

Adesuwa Okunbo Rhodes, Founder of Aruwa Capital Management, said: “In the midst of the current challenging fundraising environment, we are excited to have raised 90% of our target fund size for Fund II. This indicates our investors’ confidence and trust in our ability to execute on our proven investment strategy and double down on achievements recorded so far.
Our diverse pool of local and international LPs further reaffirms that our strategic market positioning resonates with a wide pool of investors, and we remain grateful to new and existing investors for their trust and confidence.
We remain excited to continue to showcase the untapped potential of women in
Africa.”

The Mastercard Foundation Africa Growth

The Mastercard Foundation Africa Growth Fund is a $200 million (USD) impact investing initiative by the Mastercard Foundation. It works through African investment vehicles to support earlystage, growth-oriented SMEs on the continent, with the goal of enabling dignified and fulfilling work for young people, particularly young women. The Mastercard Foundation Africa Growth Fund is catalytic, helping to crowd in additional capital for African entrepreneurs, particularly female entrepreneurs, by strengthening and de-risking African investment vehicles that are committed to advancing gender equity in entrepreneurship.

The Bank Of Industry Limited

The Bank of Industry Limited (BOI) is Nigeria’s oldest, largest, and most successful Development Finance Institution (DFI). BOI exists to facilitate the transformation of Nigeria’s industrial sector by providing financial and advisory support for establishing large, medium, and small enterprises and expanding, diversifying, rehabilitating, and modernizing existing enterprises.

EDFI Management Company

EDFI Management Company (EDFI MC) is a multilaterally owned impact asset manager which delivers innovative development finance solutions that enable European DFIs, development banks and private sector investors to increase the scale and impact of their work. The company focuses on business models, technologies and geographies where other investors have not been able to operate at the desired scale given their resources and investment criteria.

ElectriFI

The Electrification Financing Initiative – ElectriFI, managed by EDFI Management Company, is an impact-first investment facility, funded by the European Union, USAID’s Power Africa programme, the Government of Sweden and the Government of Italy. ElectriFI is investing in early-stage private companies and projects that increase or improve access to and supply of sustainable energy in developing countries.

British International Investment (BII)

BII is the UK’s development finance institution and impact investor with a mission to help solve the biggest global development challenges by investing patient, flexible capital to support private sector growth and innovation. BII currently partners with over 1,500 businesses in emerging economies, and have total assets of £8.1 billion. BII works with investee partners to support them to succeed and grow impactful businesses.

Aruwa Capital Management

Aruwa Capital Management, is one of the few women owned and managed, growth equity funds on the African continent investing in untapped investment opportunities currently overlooked by other funds, investing in essential goods and services for Africa’s next billion people.

Aruwa Capital is an intentional gender lens fund focused on investing equity to established and fast growing companies in the small to lower mid-market segment in Nigeria and Ghana that are currently undervalued and under-served by larger financial institutions. Aruwa focuses on providing growth capital to untapped indigenous and fast-growing businesses with an operating history and proven track record.