MCE Social Capital announces the final close of its MESA Fund to target gender-inclusive agri-businesses in Africa and Latin America
October 11, 2023
MCE Social Capital (‘MCE’) is pleased to announce the launch of the MCE Empowering Sustainable Agriculture (‘MESA’) Fund, which closed on October 4th, 2023, oversubscribed at US$41.6 million.
MCE is a well-known impact-first investor with a strong track record built over the past 16 years through its unique loan guarantee model. MESA, the organization’s first investment fund, will expand on MCE’s experience scaling economic opportunities within local communities, enhancing the climate resilience of smallholder farmers, and empowering women throughout the agricultural sector in emerging markets.
MESA celebrated a final close with commitments from an impressive roster of investors, including FMO: Dutch Entrepreneurial Development Bank, ImpactAssets, Visa Foundation, Blink CV, Imago Dei Fund, Sall Family Foundation and Heading for Change: The Suzanne Biegel and Daniel Maskit Endowment.
“We are impressed with the intentionality with which MCE integrates a gender lens into their work, and their commitment to further develop MESA’s investment thesis at the nexus of climate and gender. We are thrilled to be a partner to them in exploring the impact of a fully integrated climate and gender thesis of the agricultural value chain.”
– Heading for Change: The Suzanne Biegel and Daniel Maskit Endowment
The first close in February of this year brought in capital from other respected investors, including the US International Development Finance Corporation (DFC) and Ceniarth. MCE has also been fortunate to receive legal support from Mary Rose Brusewitz and the team at ClarkHill.
The investment rationale: expanding the potential of early-stage entrepreneurs and rural financial services providers
As an investor known for being willing to take smart risk in service of outsized impact, MCE took time to determine where its capital could be most catalytic. Through a series of fund design exercises supported by USAID, MCE landed on one of the most persistent and well-documented challenges in the impact space: the lack of capital for enterprises serving smallholder farmers and their communities. “We’re fortunately not alone in seeking to address this major capital gap – many of our peers in Council for Smallholder Agricultural Finance (CSAF) are also committed to this sector, and thoughtfully-designed initiatives like Aceli Africa (of which MCE is a member) are playing important roles,” remarks Camilla Nestor, MCE’s CEO.
“We are very excited to support the sustainable agricultural ecosystem through the MESA Fund as it aligns perfectly with our strategy of enabling smallholder farmers and rural MSMEs. This high-impact transaction ticks several boxes of FMO’s broader 2030 Strategy, and through this partnership we’ll be able to support smaller MFIs and SMEs, further increasing the impact of FMO’s mission.”
- Marnix Monsfort, FMO’s Financial Institutions Director
MCE has an impressive track record of investing in rural communities through small and growing agribusinesses and rural financial service providers, but the demand for capital exceeds the supply. The strategic decision to develop MESA–to sit alongside their current, on-balance-sheet guarantee model–was made to bridge that capital gap faster and more efficiently, and overall enhance the flow of financing to businesses operating in the agricultural sector.
“Funding continues to be a growth constraint for our investees due to the limited availability of local funding and a lack of collateralized assets. We are delighted to be entrusted by the MESA investors to continue providing needed support to scale up these businesses and contribute to sustainable livelihoods.”
- Elena Pons, CIO
MESA’S diversified investments will focus on financial service providers (FSPs) with an agriculture focus as well as small and growing businesses (SGBs) in the agriculture value chain. The capital will be channeled into at least 35 portfolio companies over the life of the fund.
Building on MCE’s proven track record
MCE has invested over US$300 million into FSPs and SGBs, with a focus on women and the environment. To date, its portfolio companies have impacted 11.9 million individuals (cumulative) and supported the creation of over 21,000 jobs in 2022 alone – mostly in sustainable agriculture. MESA is expected to continue the consistent excellent results of MCE’s investments since 2006.
About MCE
MCE Social Capital (MCE) is a catalytic, impact-first investor that provides flexible debt capital to enterprises committed to generating sustainable livelihoods, to allow these enterprises to scale and better serve their customers, their employees, and their communities. As of September 30, 2023, MCE’s total outstanding portfolio was $69.5M with:
● $62.3M (89.6% total portfolio) dedicated to financial services providers (FSPs), with an average client exposure of $1.3M and an average loan duration of 36 months;
● $7.2M (10.4% total MCE portfolio) invested in small and growing businesses (SGBs), with an average client exposure of $600K and an average tenor of 18 months.
For more information, check out MCE’s latest Impact Report.
For additional information, please contact:
Christina Lukeman, Director of Business Development and Communications