LeapFrog’s $1bn fund to back high-growth businesses in Africa
LeapFrog Investments, a private equity firm specializing in the financial and healthcare sectors, is raising $1 billion for a new fund focused on businesses in "global growth markets," particularly in Africa.
The Emerging Consumer Fund IV is on track to conclude its fundraising in February of the following year and has already gained the support of various institutional investors, including the European Investment Bank (EIB) and the World Bank's IFC, which have committed $60 million and $50 million, respectively.
Fund IV has also garnered investments from Prudential Financial, a U.S.-based financial services company, and AIA Group, an insurer based in Hong Kong. Prudential Financial has allocated $500 million, while AIA Group has committed $200 million as part of its multi-fund investments. Notably, Singapore-based investment firm Temasek pledged $500 million to LeapFrog's various funds, including the current one, back in 2021.
Private equity investments have grown significantly in Africa over the past decade, offering opportunities for investors seeking high returns in an emerging market. The African Private Capital Association (AVCA) estimates that $7.6 billion in private investments was poured into Africa in 2022 across 626 deals. And with an impressive recent uptick in exits, even more PE funds are targeting the continent. LeapFrog has outlined its strategy to make initial investments ranging from $30 million to $70 million in 18 to 20 high-growth businesses. The primary focus will be on healthcare and financial services enterprises in Africa, with approximately 40% of the funding directed to this region, as disclosed by the IFC. Moreover, LeapFrog has expressed interest in potential investments in South Asia and Southeast Asia.