Characterized by small, fragmented markets and a distinct sensitivity to US and global economic swings, Central America continues to be a challenging region in terms of economic development. Small companies in Central America are often family owned, with weak governance and lacking transparency. They also have difficulties in finding debt financing to grow their businesses as loans have high interest rates, short terms and numerous bureaucratic hurdles. As a consequence, small companies in Central America can only reach out to their family and friends to find capital to grow.
The Central American Small Enterprise Investment Fund III aims to address the financing gap faced by small companies in Central America by providing both debt and equity capital. The Fund will build its investment strategy on structured debt in the form of mezzanine and convertible loans, which are expected to represent 70% of investments. The Fund is also accompanied by a technical assistance facility to improve corporate governance, financial reporting, and environmental and social areas among others in small local companies. The goal of CASEIF III is to contribute to the creation of a competitive private sector in Central America. Thus, the combination of capital and assistance offered by the Fund is expected to improve the competitiveness of small companies in the region.
CASEIF III is managed by Lafise Investment Management, an experienced team of three senior partners, who have worked together for over seven years investing two predecessor funds. The team is based in the region with local offices in Managua, Nicaragua and San Jose, Costa Rica.