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Alitheia Capital and Goodwell Investments have successfully exited their investment in Baobab Nigeria, marking the first exit from their joint uMunthu Fund. Baobab Nigeria, a financial institution focused on delivering inclusive banking services to individuals and MSMEs in underserved areas of sub-Saharan Africa, has seen impressive growth over the past 12 years.
The exit follows a successful partnership that began with an investment in Baobab Nigeria, then known as MicroCred, in 2012. The investment continued through the uMunthu Fund in 2015, supporting the bank’s growth and transformation. What began as a small operation in Kaduna state has expanded to serve 230,000 customers across 16 Nigerian states, operating through a network of 38 branches, a significant increase from the initial five branches and 19,000 customers.
Throughout this period, Baobab Nigeria maintained a strong commitment to its inclusive customer base, with average loan and deposit sizes remaining small despite the bank’s rapid expansion. The uMunthu Fund played a key role in professionalising the bank, improving governance, and facilitating its growth from a microfinance institution to one of Nigeria’s top national MFIs.
Alitheia and Goodwell’s investment in Baobab marked a pioneering effort, as they were the first local investors on the company’s board and the first private capital investors in northern Nigeria, a region previously dominated by Development Finance Institutions (DFIs). Their proactive support included advising on financial structuring, governance improvements, and connecting Baobab to local networks and business expertise.
Baobab Nigeria has significantly contributed to closing the financial inclusion gap in Nigeria, particularly in northern regions, where up to 70% of the population initially lacked access to financial services. By 2023, government statistics reported that 26% of Nigerians still lacked access to financial services, a substantial improvement from the previous years. Baobab’s continued focus on serving underserved populations is reflected in its ability to reach 12 times more customers, with 7.6 times more branches, and 3.2 times more staff while maintaining small average loan sizes.
The financial success of uMunthu’s investment was evident, with the fund’s value tripling in Naira terms, showcasing the power of patient capital in emerging markets. This exit now marks a new chapter for Baobab Nigeria, as the company transitions to full ownership under the international Baobab Group. The Nigerian team plans to continue focusing on its core mission of serving the underserved, positively impacting businesses and communities across the country.
“We are incredibly proud of Baobab’s transformation from a single-room operation in northern Nigeria to one of the top three nationally licensed microfinance banks in the country,” said Tokunboh Ishmael, Managing Partner at Alitheia Capital. “Together, we’ve built a bank that stands as a testament to leadership, governance, and impactful financial growth.”
Looking ahead, Alitheia and Goodwell remain committed to their hands-on approach with the uMunthu portfolio and are optimistic about further exits in 2025. Their uMunthu II Fund is now in its final fundraising phase, actively seeking investors who want to be part of the next success story, inspired by Baobab Nigeria’s proven impact and growth.
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