wCap – Women Capital

Nyeji Chilembo – Co founder and Managing Partner for wCap limited.

The famous quote “Behind every dark cloud, lays a silver lining” stands as a true testament of
wCap (Women Capital), a financial intermediary conceived in January 2020 and birthed in May
of the same year amidst the global pandemic crisis Covid19. wCap was created from a desire to
close the funding gap of African female entrepreneurs who were overlooked by the financial
system but are building growth businesses for the future. It was evident from our experience as
female entrepreneurs in Zambia and having worked for the financial sector that there was a gap
in the market with respect to Small and Medium Sized Enterprises (SME)s run by women. For
one reason or another they do not seem to be getting the funding that they require to scale up
their businesses.


We have observed that there is a lack of information on the different funding opportunities
available to SMEs. What most business owners seem to know is to go to the bank to get a
conventional loan to fund their businesses. Little is known about capital markets and how
businesses can use it to grow their businesses. We have also found that business owners tend to
overlook the benefits that come from finding a strategic partner, getting an angel investor, or
seeking funds from a venture capital or private equity firm to growth their businesses. We also
noticed that most businesses would submit very low-quality applications for funding. Several
applications were rejected applications either because of the size of the company (banks prefer to
work with larger more established businesses), the business do not have enough collateral to
back the loan, or the business owner and management team lack the business acumen and soft
skills required to properly articulate themselves and the needs of the business effectively and to
growth their establishments.


As wCap, we decided to create a solution to the problem by participating in this space to provide
business advisory services and capital raising opportunities to a good set of businesses that need
minor adjustments to be well positioned to scale up optimally. A case in point is Sammy, a client
from the rural area with a fantastic and well positioned business in the agriculture sector, that
produced 4,000 tons of soya beans, which at the time, sold for US$360 per ton bringing in just
over U$1.2 million. Unfortunately, the entrepreneur was failing to scale up her business due to a
lack of technical and soft skills. By this I mean her paperwork was not up to par, her financial
management was weak, and her organizational structure was not correct.


What we do at wCap is take an in-depth look at the business we are dealing with, then address
issues that will help the entrepreneur add value to her business. We give advice on the nature of
the business model, the corporate governance structure, financial management and generally all
the other skills most SMEs tend to lack and overlook. One will find that nine out of ten times,
these are the things that funders and investors want to have in place. Not having these
foundational issues address is what leads to the entrepreneur being unable to go past the stages of
business growth staying in permanent start up mode. Hence, the reason we do this is to position
the business properly so that they can access capital to scale up their businesses. If pivoting in a
new direction for growth is what it takes, then that is what we will advise. In this case, Sammy
produced soya beans and sold it in its raw form/primary product, and what she needed to do in

terms of value addition was to produce soya oil resulting in even higher revenue than when she
was just selling it in its primary state. This has been the process with Cohort 1 of our Investor
Ready advisory sessions, and we have had particularly good results so far. We were pleased to
see the impact there is in helping and focusing on women businesses as a segment of the
economy that is underserved. We observed changes almost weeks after starting the sessions,
some of the businesses either started to improve and increase sales or have better operations in
place.


In terms of scaling up businesses, we at wCap see vast opportunities in Africa; however, it is
imperative to start thinking a little differently through innovation and financial deepening.
According to the IMF, all the job loss that has taken place in the last one year because of
automation that came about because of Covid19 pandemic is not going to be reversed. So
whatever business one is in, one must look ahead and look for ways in which the business can be
technologically oriented to survive the new economy that we are in. This is global and not
something that is just relevant to Africa. We are talking about resilient businesses being able to
cope in a pandemic, so it is crucial to move with the times.


Clearly, automation or digitalization is one of the key things an SME now needs to investigate
and adopt, we encourage this in the advisory process at wCap. Unfortunately, Africa tends to lag
in this regard for obvious reasons such as our markets and technology are not as advanced as
they should be. We believe our investment ecosystems are addressing this while growing and
improving businesses at the same time, soon enough the continent will adapt and catch up with
more advanced economies.


One thing that will help to facilitate the innovation and growth of businesses on the continent is
the enactment of the African Continental Free Trade Area Agreement (AfCFTA). From a trade
perspective, it presents immerse growth opportunities for businesses all over Africa because now
we are looking at a massive new market. Take for example Sammy from our case that is growing
soya beans, her market is no longer limited to just the Zambia, she now can pivot her business
model into an agribusiness commodity trading company and export to markets around the
continent that are now easier to reach.


The AfCFTA is a great opportunity for businesses to grow in terms of their revenue base. The
AfCFTA provides a fantastic opportunity for businesses to earn in foreign currency. Businesses
in Africa need to actively participate and use this tool to their advantage. I acknowledge that the
roll out process may not be straightforward; the reason for this being different countries are at
various stages of development and there are different bureaucratic red tape methods that each
country must harmonize. Also, when you look at it from a financial integration perspective, for
the economy to grow we need to create a financial system that supports and facilitates trade and
other business-related transactions. When we look at it from an African perspective, various
financial systems are at different stages of development, harmonization and integration is
required. So, the AfCFTA is a great development, but it is a difficult process that we are going to
have to go through as a continent before reaping its fruits in the long run.


Scaling up requires true vision that stems from bright minds in business; it requires innovation,
resilience and a supportive financial sector that must evolve or deepen to cater to the changing
needs of businesses on the continent. This is what led to us creating wCap. We saw it as an

opportunity to create a focused and specialized financial intermediary that serves high growth
women led businesses in Africa that would otherwise be marginalized by the financial system.
In sum: In line with innovation, wCap was created to fill a gap in the financial sector for women
led businesses in Africa and we are pleased to be part of the business and investment ecosystem
in Africa. Through our advisory process, we reposition businesses to be optimally primed to
receive the funding required to expand their existing operations effectively. We observe that to
survive and thrive in business, one must be innovative and resilient to forge ahead with their
vision with a solid strategy in place that they can keep their eyes on to do the extraordinary and
be futuristic in their activities. We also observe that financial sector deepening through
innovation is key to facilitating the necessary financial transactions that will support businesses
participating in the AfCFTA and the growing trade markets in Africa.