Today, Dutch fund manager XSML announced its investment in Starz-kin, a retail business consisting of shops that sell household goods to the lower end of the market in DRC. This investment, through XSML’s Central Africa SME Fund, is the first long term finance for Starz-kin and contributes to its expansion plans into smaller cities in the interior of Congo.
Kinshasa, Democratic Republic of Congo
Kisangani, Tshikapa and many more smaller, remote cities in Congo face high transport costs leading to high product prices for the end customer. Through its network of shops and their economies of scale, Starz-kin is able to offer a reliable and affordable range of household and personal hygiene products throughout Congo.
The Managing Director of Starz-kin, Mr. Eeke Iyamba, states: “With the support provided by the Central Africa SME Fund, Starz-kin is now able to expand further into the interior of Congo. With this long term finance in place we can start opening up shops in Kisangani in the North-East of the country, a region of Congo that is remote and lacks a reliable supply of household items.”
Marcel Posthuma, Managing Partner at XSML says: “Our investment in Starz-kin will help solve the scarcity of affordable household and personal hygiene products in remote areas of Congo. Besides 4 stores in Kinshasa, Starz-kin operates household good shops in more remote cities like Tshikapa and Kikwit. The expansion into Kisangani is the next step in its expansion plans and we are looking at other smaller cities in the interior for the years hereafter.”
Starz-kin is the twelfth investment made by CASF and its ninth investment in DRC. CASF is an investment fund investing in small and medium-sized enterprises in the Democratic Republic of Congo and the Central African Republic. The fund is based on the belief that sustainable economic development in the fast growing markets of DRC and CAR can be achieved by encouraging entrepreneurship. Currently, many opportunities in these countries remain unexploited due to the lack of risk capital and support. By stimulating entrepreneurial endeavors jobs and income are created. CASF is a USD 19m fund with 80% allocation to DRC and 20% in CAR. CASF provides risk capital with an investment size ranging from USD 100,000 to a maximum of USD 500,000. Investors in CASF are IFC, FMO and the Lundin Foundation.
About Starz-kin SPRL
Starz-kin operates 11 stores for household goods and personal hygiene products dedicated to the lower-end of the market. It has stores in Kinshasa, Tshikapa, Muanda, Kikwit and Matadi.
XSML is an independent private equity fund manager with a focus on frontier markets. While building and managing funds for these markets, XSML, eXtra Small Medium Large, aims to help grow small businesses into medium and large enterprises. XSML was founded in 2008. The managing partners have an extensive background in emerging markets in the areas of asset management, corporate and development banking and corporate restructuring. Our experience has shown that demand for finance from small and medium sized enterprises (SMEs) remains largely untapped despite increased interest in frontier markets from international investors. XSML bridges this gap between international investors and SMEs in these markets.