Approach
At Zoscales Partners, we focus on growth capital in small and medium-sized companies in key East African economies. We prioritize investments in sectors with high projected compound annual growth rates and apply our unique investment approach, “the ZP Way”, to confront the challenges of investing in frontier markets. The key ingredients of this approach are the three Cs:
Control: We take control of our investments through either a majority shareholding or a minority shareholding by the use of preferred shares or equivalent instruments.
Champions: We have built strong relationships with local operators and C-level talent in the market to steer the portfolio companies.
Concentration: We focus on a small number of quality deals in more liquid industries, carry out intense early dialogue with buyers, and leverage industry know-how and network.
We execute this strategy with an investment team with particular investment expertise in core industries, bolstered by local operating partners who have long and deep operational expertise to execute sector-specific value creation initiatives.
Industry Focus
We focus on 3 core industries with high projected compound annual growth rates and attractive exits through trade sales and secondary buyouts:
Fast-Moving Consumer Goods: Packaged food and beverages, personal care, etc.
Healthcare: Pharmaceuticals, healthcare service providers, medical devices, diagnostics, etc.
Sustainable Industrial Development: Circular economy initiatives, industrial decarbonization, captive energy solutions for industry, etc.
Why Invest in East Africa?
East Africa is among the fastest growing regions in the world and provides attractive direct investment opportunities as well as an enabling environment for private equity investments.
An economic growth leader: East Africa has a population of over 370 million and expected GDP growth rates of 5-10% for the next 10 years. The sustainability of the growth is supported by a broad industry diversification and low dependency on commodities.
Rapidly growing middle class and strong urbanization: Successful small and medium-sized companies are tapping into the growth in consumer affluence and discretionary spending, providing more than 30% return on investments.
Human and social environment: Over the last decades, East Africa has seen improved political stability and regional cooperation, conducive human and social environment, and long-lasting peace.
Investor protection, corporate governance and taxation: Good investor protection and corporate governance as well as increased support to foreign direct investments by local governments are additional attractive investment fundamentals for private equity investments in the region.
Entrepreneurial spirit and deal opportunity: East Africa is characterized by a vibrant entrepreneurial culture, which translates into an increased number of private equity deal opportunities in the SME space.