Aruwa Capital Management, a Lagos-based early-stage growth equity firm, has secured $35 million in its second funding round, reaching 90% of its $40 million target for its second fund, Aruwa Capital Fund II. The firm, which focuses on gender-lens investing, is now considering an upsizing of the fund to $50 million due to strong institutional demand, with a hard cap set at $60 million.
The latest close surpasses the total size of Aruwa’s debut fund, which closed at just over $20 million in 2022. Fund II has drawn commitments from returning investors, including the Mastercard Foundation Africa Growth Fund (MFAGF) and Visa Foundation, alongside new backers such as Nigeria’s Bank of Industry (BOI) and international development financiers British International Investment (BII) and EDFI Management Company.
The fundraising success comes amid a tough environment for emerging market private capital, underscoring investor confidence in Aruwa’s strategy of backing high-growth businesses in essential sectors such as healthcare, energy access, financial services, and consumer staples.
Adesuwa Okunbo Rhodes, Founder and Managing Partner of Aruwa Capital, said the progress reflects trust in the firm’s ability to execute its investment thesis. “Our diverse pool of local and international LPs reaffirms our strategic positioning,” she said.
Aruwa’s first fund has demonstrated strong performance, with its 11 portfolio companies growing revenues by an average of 22x (in local currency terms) since investment. Follow-on funding rounds for these businesses have occurred at valuations roughly seven times higher than Aruwa’s initial entry points.
Notable investments from Fund I include Lifestores Healthcare, fintech firm FairMoney, and cold-chain logistics provider Koolboks. Fund II has already deployed capital into two companies: Yikodeen, a Nigerian safety boots manufacturer, and a fast-casual dining chain — both selected for their potential to drive inclusive economic opportunities for women.
The fund’s expansion has been bolstered by support from development finance institutions (DFIs) and impact-focused investors.
Bank of Industry (BOI), Nigeria’s largest DFI, is a first-time investor in Aruwa’s second fund. Dr. Olasupo Olusi, BOI’s Managing Director, cited Aruwa’s track record in bridging SME funding gaps as a key factor in the decision.
British International Investment (BII), the UK’s development finance institution, highlighted Aruwa’s role in addressing early-stage funding shortages, particularly for women-led businesses.
EDFI Management Company, through its EU-backed ElectriFI initiative, is supporting Aruwa’s push into renewable energy access solutions. Rodrigo Madrazo, EDFI’s CEO, noted the alignment with climate resilience and gender-inclusive growth goals.
Aruwa’s gender-lens approach has been a distinguishing factor — 73% of its Fund I portfolio companies are founded or led by women. Across both funds, the firm estimates it supports over 200,000 direct and indirect jobs.
Dorothy Nyambi, President & CEO of MEDA, which manages the Mastercard Foundation Africa Growth Fund, praised Aruwa’s employment impact, calling it “a powerful reminder of what’s possible when we invest with intention.”
With the final close expected later this year, Aruwa is positioned to further expand its investments in Nigeria and Ghana, targeting businesses that combine commercial viability with social impact. The firm’s ability to attract global institutional capital could signal broader investor appetite for gender-smart strategies in African markets.
Aruwa Capital is a female-founded and led private equity firm investing in high-growth SMEs in Nigeria and Ghana. The firm employs a gender-lens approach, prioritizing businesses that enhance economic opportunities for women while delivering strong financial returns.
Key Investors in Fund II:
- Mastercard Foundation Africa Growth Fund
- Visa Foundation
- Bank of Industry (BOI)
- British International Investment (BII)
- EDFI Management Company (via ElectriFI)