Aria FoG #7

ARIA, the Africa Resilience Investment Accelerator, has published the seventh edition of its Foundations of Growth series. This edition focuses on Permanent Capital Vehicles (PCVs) and why they matter in markets where traditional private equity and debt fund models often fall short. In regions with thin liquidity, higher volatility, and slower regulatory processes, businesses typically need patient, long-term capital to mature.

Permanent capital vehicles (PCVs) offer an alternative. They enable investors to support transformative businesses – including those working in climate adaptation, resilient infrastructure and urbanisation – that are often overlooked by time-bound funds. With the option of recycling capital, these funds can also support companies throughout the cycle, providing businesses with support in challenging conditions and enabling investors to exit when the timing is favourable.  

The publication includes: 

• A clear explanation of PCVs: What they are, how they work and why they matter in the African context. 
• PCV opportunities: Exploring the opportunities PCVs create, including patient capital for sectors with long growth horizons and the ability to weather macroeconomic shocks. 
• A candid look at the challenges: From regulatory complexity and transaction costs to aligning incentives and managing liquidity. 
• Case studies: Looking at pioneering examples, such as Growth Investment Partners in Ghana and Zambia, AgDevCo across sub-Saharan Africa, ARISE across sub-Saharan Africa and Truestone in Sierra Leone.  
• Recommendations: Discussing how to unlock the full potential of PCVs to drive inclusive, sustainable growth.

The Africa Resilience Investment Accelerator (ARIA) was launched in 2021. Since then, we have unlocked more than $45 million in DFI investment, built a pipeline of investable opportunities and delivered multiple technical assistance projects for companies in frontier markets.  The initiative is funded by British International Investment, FMO, the Dutch entrepreneurial development bank, and Proparco.