Small Foundation has made a catalytic investment in Ci Gaba, a Ghana-based, local-currency fund of funds established to mobilise domestic institutional capital into small and medium enterprise (SME) finance.
This commitment supports the fund’s first close and enables it to secure initial allocations from Ghanaian pension funds and other long-term institutional investors.
SMEs remain the primary drivers of economic growth, employment, and innovation across sub-Saharan Africa. In Ghana, as in much of the region, these enterprises face chronic underfunding despite their critical role in the economy.
Domestic institutional investors particularly pension funds manage substantial pools of long-term capital, yet only a limited portion is allocated to local private markets.
The principal constraints include limited familiarity with private equity and venture capital, a shortage of proven local fund managers, and heavy reliance on foreign-currency funding, which introduces exchange-rate volatility risk for both investors and businesses.
Ci Gaba addresses these structural barriers through a blended finance structure that uses catalytic capital to de-risk early participation by local institutions.
This approach creates a credible entry point for pension funds and similar investors to allocate to SME-focused venture capital, private equity, and debt funds.
The Role of Catalytic Capital
Small Foundation’s investment functions as catalytic capital, deliberately absorbing higher risk in the early stages to enable domestic institutional investors to participate with greater confidence.
Catalytic capital allows us to absorb risk where it matters most so that local investors can participate with confidence. Our investment in Ci Gaba is about shifting capital flows, not just supporting a single fund
Conor Brosnan, Chief Investment Officer and Chair at Small Foundation
READ ALSO:Can the Ci-Gaba Fund Bridge Long-Term Savings and High-Growth Businesses?
By providing first-loss or subordinated capital, Small Foundation lowers the perceived risk for pension funds and other conservative investors. This de-risking mechanism is designed to:
- Build a credible performance track record for SME-focused funds.
- Demonstrate the viability of local-currency private market investments.
- Reduce the long-term dependence on concessional or foreign capital.
- Create a self-sustaining market in which domestic institutions allocate meaningfully and consistently to private markets.
Mobilising local capital isn’t just about funding SMEs; it’s about transforming markets so that investors have confidence, and local enterprises have the resources they need to succeed. That’s the mission of Ci Gaba
Hamdiya Ismaila, founder of Savannah Impact Advisory and fund manager of Ci Gaba
Structural and Market Implications
Ci Gaba operates as a fund of funds, investing in a diversified portfolio of high-quality SME-focused managers in Ghana. The structure offers several advantages:
- Currency Alignment: Investments are made in local currency (Ghanaian cedi), eliminating exchange-rate risk for domestic investors and borrowers.
- Risk Mitigation: The catalytic layer absorbs initial losses, improving risk-adjusted returns for subsequent institutional commitments.
- Capacity Building: The fund supports emerging local fund managers through co-investment, technical assistance, and performance monitoring.
- Market Signal: Participation by credible international and domestic institutions validates the asset class, encouraging broader adoption by pension funds and insurers.
This model addresses a persistent market failure: the mismatch between abundant domestic long-term savings and the chronic underfunding of growth-oriented SMEs.
By unlocking these capital pools, Ci Gaba aims to enhance SME access to finance, improve enterprise resilience, and contribute to broader economic formalisation.
Broader Development Impact
The initiative aligns with Small Foundation’s strategic focus on addressing structural gaps in financial systems to enable more inclusive and resilient economic growth. Key expected outcomes include:
- Increased availability of patient, local-currency growth capital for SMEs.
- Enhanced capacity and track record among emerging Ghanaian fund managers.
- Greater confidence among domestic institutional investors in private market allocations.
- Improved economic multipliers through job creation, supply-chain development, and enterprise formalisation.
The investment also contributes to regional learning, offering a replicable model for other African markets seeking to mobilise local institutional capital for SME development.
Looking Ahead
Small Foundation’s catalytic investment in Ci Gaba represents a targeted intervention to overcome structural barriers to domestic capital allocation in Ghana’s private markets.
By de-risking early participation, the commitment enables local pension funds and institutions to engage with SME finance with greater confidence, creating a self-sustaining ecosystem for growth-oriented enterprises.
This initiative exemplifies the role of catalytic capital in shifting financial flows toward inclusive economic development.
For the most current details on Ci Gaba’s progress, portfolio developments, or partnership opportunities, refer to official announcements from Small Foundation, Savannah Impact Advisory, or Ci Gaba.
Small Foundation Overview
Small Foundation is a philanthropic organisation that supports initiatives aimed at lifting people out of extreme poverty, particularly in sub-Saharan Africa.
The Ci Gaba Fund is an investment initiative associated with Small Foundation that focuses on inclusive finance and smallholder-focused enterprises, supporting scalable solutions that improve livelihoods.
A small foundation working capital facility or GP facility typically refers to structured funding mechanisms designed to provide liquidity or operational capital to fund managers and impact vehicles aligned with the foundation’s mission.
The term ‘investment executive – small foundation’ usually refers to a professional role responsible for sourcing, evaluating, and managing investments or grant-backed financial vehicles within the foundation’s portfolio.
Small Foundation grants are provided to nonprofit organisations, research institutions, and impact-driven entities working in agriculture, rural development, financial inclusion, and economic resilience.
Ronnie Paul is a seasoned writer and analyst with a prolific portfolio of over 1,000 published articles, specialising in fintech, cryptocurrency, climate change, and digital finance at Africa Digest News.
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