Creating Wealth Beyond Profit!

How Kinvest Venture Partners is Changing the African Landscape with Social Impact Investing

November 2023

Our world is increasing in both awareness and sensitivity to global needs. For example, the United Nations has created the Sustainable Development Goals to pave the way for global progress. As the world awakens to these issues, leaders from all sectors are recognizing that they must include business as part of the solution for global change and combine social needs and financial returns.??

Enter Kinvest: kinship and investing together. We adopted a profitable business model that addresses generational poverty in rural Africa through employee shared ownership. Our innovative approach is generating value beyond profit.?

A Problem Defined

Kinvest Venture Partners began in 2020 after our leadership team collectively recognized that the western way of financially supporting the systemic challenges in Africa was failing. Sub-Saharan Africa alone receives over 62 billion dollars in aid from other countries around the globe per year, not including charity. Even with these western forces' contributions, there was not lasting change.?

Some African countries have been heavily afflicted by years of war, unstable governments, and impacted by major urbanization. Due to these challenges there became a longstanding financial insecurity at local and national levels. This also resulted in a massive underutilization of Africa’s agricultural potential.?

In fact, Africa ranks as one of the highest regions with untapped agricultural capacity yet indexes extremely low in the total amount invested in Agri-business compared to its global counterparts. The World Bank generated a report that showed, “despite its importance to economic growth and poverty reduction throughout Asia and Latin America, agriculture remains a neglected sector in Africa."

Why has foreign aid and the traditional charity model failed to produce sustainable and systemic change? What does rural Africa require to better their local economies and increase their self-determination??

Our leadership team studied this complex issue and convened with other thought leaders and stakeholders. We decided that we wanted to bring an impact investing model to the table that would impact both North Americans and those in poverty in rural Africa. We wanted to develop something that will create generational wealth, financial security, and create capital assets to help those in poverty get ahead in life.?

“We decided that a new business model was needed to change the trajectory of poverty alleviation if rural Africa was to fulfill its economic and human potential.”?

CEO, Ray Sawatsky?

Why Africa?

Africa is a vast and diverse continent for business and impact investing, while remaining a place with great need. The unique and diverse countries on the African continent present many untapped opportunities. In Sub-Saharan Africa specifically, there is a wealth of agricultural potential. Currently, Africa holds 60% of the world's uncultivated arable land, and only 6% of the cultivated land is irrigated.?

Looking to the future, Kinvest recognizes that with the world's growing population and needs, Africa has the agricultural potential to feed 60% of the world by 2050. This provides both the longevity and continual stability that Kinvest will use to create long-term solutions to help alleviate poverty.?

A Proven Solution

Businesses are uniquely equipped to tackle complex societal problems, if they focus their energies towards it. They can create innovative products and services that are needed, create good paying jobs, and stimulate local economies.?

Recognizing this fact, we adopted a unique approach that generates solid returns for our investors while simultaneously creating the generational wealth that rural Africans require. Our business model leverages employee shared ownership and combines it with impact investing. Impact investing is well placed to be part of the future solution for the world as generous people are looking for something different than charity.?

With the agricultural possibilities available in Africa, we purchased land in 2021. This land was used to start a medium sized commercial produce farm but with a twist. Kinvest is transforming a typical venture model into a dynamic new employee shareowner model over 10 years.

It works like this:?

1. Kinvest brings together a number of limited partner investors from Canada to develop a medium sized agriculture company in Rwanda. The company will acquire and develop 500 to 700 hectares of land.? The immediate impact of the company is creating sustainable and reliable jobs in rural Rwanda, paying 3 times the average wage. Over the course of 10 years, we focus on developing trusting and meaningful relationships with our employees, getting to know them and their families. We intentionally invest in each person through personal and professional development. Employees receive agricultural education, financial literacy training, and leadership development skills that prepare them to own and operate the farm.?
2. Throughout this process, we continue to focus on building a sustainable and profitable venture with high yield cash returning crops and long term orchards that will produce positive returns for investors and lasting, high value capital assets for the future owners, the employees.
3. Employees are invited to learn, grow and through an employee stock option plan the employee will own the company outright after 10 years and become owner-operators.
4. Investors will get a 10 year run with the company and then they transfer their shares to the employee trust, which manages the employee stock option plan.? Modeling shows potential investor returns in the range of 12% per year through company revenue all providing enough capital, in addition to their returns, to fund the share transfer to the employee trust. The farm then becomes 100% owned by the employees.?
5. By owning the farm, offering a savings account and trust, and sustainable jobs, rural Africans now possess capital assets, the foundation of generational wealth for the future. Those once stuck in poverty can do things like financially plan, consider savings, and have money for their families. This will lift the local economy and address the UN’s Sustainable Development Goal #8- “promoting sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all.“

Local ownership is necessary for meaningful and long-term poverty alleviation and the creation of generational wealth. By investing in local ownership, investors profit, businesses are sustainable, and rural Africans become shareowners of capital assets. This is an equitable distribution of value.?

Partner with Us

Since our first commercial venture in 2013, we have purchased two more plots and now have three fully operating farms in production in Rwanda. This is just the beginning of what our venture fund envisions. We see an impact investing vehicle supported by investors who believe that business can be a mutually beneficial agent in the world that generates positive financial returns while promoting people to flourish.

Our Venture Fund and proven business model is changing the trajectory in rural Africa by helping local employees transition from unskilled labourers, to valued staff, to owners of capital assets!

Partner with us today to help generate value beyond profit.?

Regards,

Ray Sawatsky

CEO?

Kinvest Venture Partners