Alitheia Capital and Goodwell Investments have successfully exited their investment in Baobab Nigeria, a microfinance institution that has played a key role in expanding financial access for underserved individuals and small businesses in Nigeria. This exit marks the first divestment from the uMunthu Fund, an investment vehicle dedicated to funding high-impact businesses in Africa.
A 12-Year Journey of Growth and Financial Inclusion
Baobab Nigeria was once a small microfinance institution operating from a single office in Kaduna State. When Alitheia Capital and Goodwell Investments first invested in 2012, the bank had just five branches and served 19,000 customers. Today, it has expanded into 16 states, operating 38 branches and serving 230,000 customers.
The expansion was fueled by targeted investment in governance, financial structuring, and local market expertise, led by Alitheia Capital, a Lagos-based private equity firm managing over $250 million in assets. Since its founding in 2007, Alitheia has focused on impact-driven investments, backing high-potential businesses that not only deliver financial returns but also address social challenges.
Similarly, Goodwell Investments, a Dutch impact investment firm with a 20-year track record, has been at the forefront of funding businesses in Africa and India that provide essential services and income opportunities to underserved communities. With teams in Kenya, Nigeria, South Africa, and the Netherlands, Goodwell’s investment strategy centers on early-stage equity funding for high-growth companies like Baobab Nigeria.
The Impact: Closing Nigeria’s Financial Inclusion Gap
Nigeria has historically faced significant financial exclusion, particularly in rural areas.
- In 2012, 70% of Nigerians lacked access to banking services.
- By 2023, that number had dropped to 26%, partly due to institutions like Baobab Nigeria expanding access to financial services.
Throughout its expansion, Baobab Nigeria ensured its services remained affordable and accessible:
- Average loan size: NGN 2 million (EUR 1,250)
- Average deposit size: NGN 91,000 (EUR 58)
The bank’s ability to scale while continuing to serve low-income customers highlights the potential of microfinance in emerging markets.
How Alitheia and Goodwell Shaped Baobab’s Growth
Alitheia and Goodwell were the first private investors in Baobab Nigeria, helping the bank transition from a regional lender to a national microfinance institution. Their contributions included:
- Strengthening governance – Supporting the professionalization of board and management structures.
- Financial structuring – Advising on growth strategies to ensure sustainable expansion.
- Local expertise – Providing strategic guidance to help Baobab navigate Nigeria’s complex business landscape.
Their investment was one of the first instances of private capital entering Northern Nigeria, a region where microfinance was previously dominated by development finance institutions (DFIs). This pioneering move helped bridge the gap between public-sector funding and private-sector-driven financial inclusion.
A Successful Exit and a Promising Future
With this exit, Baobab Nigeria is now fully owned by its parent company, the international Baobab Group. The Nigerian team plans to continue expanding financial services across the country, reinforcing its commitment to serving underserved communities.
“This was a bank that was operating out of a single room in northern Nigeria when we invested, and today it is a top-three nationally licensed microfinance bank,” said Tokunboh Ishmael, Managing Partner at Alitheia Capital. “We’re proud of what’s been achieved together, and look forward to seeing where the future will take Baobab Nigeria.”
What’s Next for Alitheia Capital and Goodwell Investments?
Following this successful exit, Alitheia and Goodwell are turning their attention to new investment opportunities. They are currently raising funds for uMunthu II, a EUR 150 million investment vehicle designed to support more businesses like Baobab Nigeria.
With its strong track record, Goodwell Investments continues to provide early-stage funding to impact-driven businesses across Africa and India. Meanwhile, Alitheia Capital remains a leader in impact investing, deploying private capital to high-potential African SMEs that generate both financial and social returns.
As they look toward additional exits in 2025, the two firms remain committed to proving that patient capital can drive sustainable, high-impact growth in emerging markets.
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