Abstract
Lightrock is a leading global investment platform backing innovative, scalable businesses that deliver both risk-adjusted financial returns and measurable positive social and environmental outcomes. With a strong presence in emerging markets, Lightrock focuses on enterprises addressing critical global challenges in areas such as climate, healthcare, education, the equitable rollout of AI, and financial inclusion. Its investment approach is grounded in rigorous impact and ESG integration, ensuring that portfolio companies generate sustainable value for stakeholders, while contributing meaningfully to more inclusive and resilient economies.
One example of this dual-return philosophy within the platform’s Africa portfolio is 4G Capital, highlighted in the Lightrock Impact and Sustainability Report 2024. The featured case study illustrates how the company has combined strong commercial growth while expanding access to finance for underserved MSMEs (micro-small-and-medium-sized enterprises), reflecting the role of Lightrock’s hands-on support and impact-aligned capital in driving both market-leading performance and societal impact.
Article
Operating across private and public markets, Lightrock advises over $5.8 billion in assets and Lightrock funds invest in Europe, North America, Latin America, Asia, and Africa. Lightrock is a certified B Corp with a dedicated team of over 130 professionals working across a network of seven offices.
Lightrock funds have invested growth equity in more than 90 private companies that pursue scalable and tech-driven business models around the key impact themes of people, planet, and productivity.
Lightrock’s public market investing applies its deep expertise in driving positive impact and ESG outcomes in the global small-cap universe, with a strategy that typically includes 50–75 companies and aims to create long-term value for stakeholders through engaged ownership and fundamental research.
Lightrock’s investment strategies guide the identification of high-growth opportunities and the deployment of capital to generate strong returns alongside measurable impact. Lightrock’s private equity impact investing strategies focus on scalable businesses delivering solutions across themes such as climate, healthcare, mobility, and financial inclusion.
While spanning both developed and developing markets, Lightrock’s strategies are tailored to tap into opportunities in fast-growing emerging economies. Regional strategies in Latin America, India, and Africa back purpose-driven growth-stage companies addressing structural challenges in markets such as Brazil, Mexico, India, Kenya, Nigeria. These strategies apply local expertise to support proven, innovative business models with the potential to scale commercially while delivering meaningful impact.
Portfolio companies like 4G Capital demonstrate how Lightrock’s regionally informed strategies and hands-on partnership deliver market-rate returns alongside measurable societal outcomes.
4G Capital is a market leader in digital, real-time working capital financing for MSMEs across Kenya and Uganda
Impact Theme: Productivity
First Investment: February 2022
Sector: Transforming finance
Country: Kenya & Uganda
SDG Alignment: Target 9.3: Access of small-scale enterprises to financial services
Impact in 2024:[1]
- 200+ branches across Kenya & Uganda
- 600k+ customers[2]
- $620m loan volume disbursed2
Challenge
Financial exclusion is holding back MSMEs across sub-Saharan Africa from developing in line with their potential. Support for small businesses is needed to enable thriving local economies and to support the transition from an informal to formal existence for their owners and their families.
Impact
4G Capital tackles the financial challenges faced by underserved MSMEs through its proprietary technology, offering them unsecured, short-term business loans that are optimised for client business risks and affordability. The company’s technology underwrites loans using a machine learning algorithm that is backed by 12 years of data, allowing the business to right-size working capital loans, ensure that customers are not overfunded, and that the loans align with their specific business cycles.
By integrating a tailored business training programme, 4G Capital also empowers MSMEs to effectively use loans and manage cash flow, thereby enhancing their ability to increase income and secure additional funding for business growth, all of which has shown to increase business growth by up to 82% year-on-year. Since its inception, 4G Capital has delivered 5.5 million loans, with a 92% repeat customer rate.
Lightrock’s role
Lightrock’s relationship with 4G Capital quickly took shape across multiple touchpoints between both businesses. 4G Capital has strong connections with multiple Lightrock departments, with two key Lightrock team members sitting on the board. The board members provide governance advice, support with strategic planning and goal setting, and are heavily involved with growth initiatives. They also advocate for the company, facilitating conversations with new investors, and leveraging their networks to help 4G Capital develop new strategic partnerships.
Lightrock further helped 4G to make valuable connections to individuals who later joined the company, bringing expertise in risk, compliance, and data analytics. This has enabled 4G to develop and strengthen its processes for identifying and reducing risk exposure.
For more information on 4G Capital, please visit their website or consult their 2024 Sustainability Report.
For further details on Lightrock, please see the Lightrock Impact and Sustainability Report 2024 or visit the Lightrock website.
[1] Impact figures are company reported.
[2] Since company inception.