Terms of Reference for consulting services for the design and structuring of AECF Capital, and in-house fund management capacity

1. About AECF

The AECF, LLC (Africa Enterprise Challenge Fund) is a leading non-profit development organization that supports innovative enterprises in the agribusiness and renewable energy sectors with the aim of reducing rural poverty, promoting climate-resilient communities, and creating jobs.

We catalyze the private sector by surfacing and commercializing new ideas, business models, and technologies designed to increase agricultural productivity, improve farmer incomes, expand clean energy access, reduce greenhouse gas emissions, and improve resilience to the effects of climate change. We finance high-risk businesses that struggle to access commercial funding; we are committed to working in frontier markets, fragile contexts, and high-risk economies where few mainstream financing institutions dare to go.

To date, we have supported over 510 businesses in 26 countries in Sub-Saharan Africa, impacted more than 33million lives, and created over 35,000 direct jobs. The AECF is headquartered in Kenya and has offices in Côte d’Ivoire, Tanzania, Nigeria, South Sudan, Benin, and Somalia.

AECF, through its newly established investment arm, AECF Capital, seeks to expand its impact by building an Africa-based and led Fund Management vehicle. The initial focus will be on a wholesale lending facility to Microfinance Institutions (MFIs) as an expansion of AECF’s financial inclusion work. The fund management infrastructure, however, will be designed to scale beyond this first facility, enabling AECF Capital to manage Funds across multiple sectors, including renewable energy and agriculture.
The objective is to position AECF Capital as a credible, Africa-rooted, and Africa-funded Fund Manager that can mobilize institutional and development finance capital while delivering strong financial returns and measurable impact in areas such as employment, gender equity, and climate resilience. To this end, AECF is recruiting a consultant to guide the structuring and incubation of its in-house fund management capacity through AECF Capital, ensuring that the wholesale lending facility serves as a foundation for long-term, multi-sector growth.

2. Purpose of the consultancy

The purpose of this consultancy is to provide expert guidance in the design, structuring, and incubation of AECF Capital’s in-house fund management capacity, beginning with the establishment of the wholesale lending facility. This facility will serve as the foundation for AECF Capital’s broader mandate to mobilize institutional and development finance capital, while building the systems and capabilities necessary to operate as an independent, Africa-based and led Fund Manager.

The consultancy will:

1. Develop a fund structure and operational model that is scalable across multiple sectors, including financial inclusion, renewable energy, energy access, and agriculture, with climate resilience, gender, and job creation as cross-cutting themes
2. Establish the governance, risk management, portfolio management, and reporting frameworks required of a professional fund manager, aligned with global best practice and investor expectations
3. Design a fundraising strategy and investor engagement plan that positions AECF Capital to attract both African and international limited partners (LPs)
4. Define a capacity-building roadmap to enable AECF Capital to leverage AECF’s existing infrastructure and track record, while developing specialized expertise needed to manage funds independently
5. The goal is to ensure that AECF Capital emerges from this assignment positioned as a credible Africa-rooted Fund Manager, capable of mobilizing capital at scale and delivering strong financial returns alongside measurable impact in gender equity, job creation, and climate resilience.

3. Scope of work

The consultant will guide AECF Capital in structuring and incubating its fund management capacity, beginning with the microfinance wholesale lending facility. The scope of work will cover the following areas:

1. Fund design and structure
   • Design an optimal fund structure with the appropriate mix of equity, debt, and blended finance instruments that align with AECF Capital’s objectives and is capable of scaling across multiple sectors.
   • Propose a governance framework, legal structure, and jurisdiction appropriate for a credible, Africa-based fund manager
   • Define risk management approaches, including credit enhancement, hedging, and product innovation
   • Develop and stress-test a financial and operational business model with five-year projections under base, best and worst-case scenarios.
2. Fund management infrastructure
   • Advise on the establishment of portfolio management, disbursement, collections, and impact reporting systems that reflect international best practice and investor standards
   • Propose a roadmap for leveraging AECF’s existing infrastructure to incubate AECF Capital’s independent fund management capabilities
   • Recommend capacity building interventions for staff, including training in fund operations, portfolio analytics, and investor relations.
3. Data and systems
   • Design and embed data-driven systems at the heart of AECF Capital’s operations strategy to ensure simple, transparent, and scalable reporting
   • Move beyond traditional headline metrics by developing approaches that allow for granular and comparable reporting across financial, impact, gender, and climate indicators
   • Ensure data systems are designed to reduce the reporting burden on portfolio institutions, while enhancing accountability and visibility for investors
4. Fundraising and investor engagement
   • Develop a fundraising strategy targeting African and international limited partners (LPs), including DFIs, institutional investors, philanthropic organizations, and local capital pools
   • Support AECF Capital in preparing investor materials (investment memorandum, pitch deck, teaser, and financial model)
   • Guide on structuring catalytic instruments (e.g., guarantees, first-loss, blended capital) to attract investors.
5. Impact and value creation
   • Define the facility’s impact framework, with clear metrics on gender equity, job creation, and climate resilience and/or other relevant metrics
   • Align the framework with global standards (e.g., GIIN IRIS+, 2X Global, IFC Operating Principles for Impact Management)
   • Demonstrate how data systems will enable consistent, comparable impact reporting that meets investor expectations while minimizing reporting burden on portfolio institutions.

4. Expected outcomes and deliverables

The consultant will be expected to deliver the following outputs over the course of the assignment:

5. Institutional arrangement

The consultant will report directly to the Head of Investments, AECF, who will provide overall technical oversight and serve as the primary point of contact for this assignment. Coordination with other AECF departments will be facilitated as needed to ensure alignment with existing systems, governance structures, and operational processes.

6. Duration of the work

The duration of this assignment will be three (3) months. Deliverables will be phased to allow for iterative review and feedback by AECF Capital, ensuring alignment with strategic objectives. Key milestones will include:
• Month 1: Initial fund design and structure options, draft financial model and stress tests, preliminary fundraising strategy.
• Month 2: Refined fund structure and governance framework, draft investor materials, capacity building roadmap, data and systems framework.
• Month 3: Final deliverables, including complete fundraising strategy, documentation roadmap, and training program outline.

7. Qualifications

The consultancy team should bring together expertise and experience that demonstrates the ability to deliver on the scope of work. At a minimum, the team or consortium should include:

Lead Consultant

• Demonstrated experience in designing and structuring private capital vehicles or wholesale lending facilities in Africa
• Proven track record in supporting the emergence of African fund managers or equivalent capacity building initiatives, evidenced by at least one client reference letter
• Strong understanding of impact investment, blended finance instruments, and governance structures relevant to fund management in frontier markets.

Corporate Finance / Capital Raising Expert

• Significant experience in fundraising for private capital funds in Africa, including engagement with DFIs, philanthropic organizations, institutional investors, and non-traditional sources of capital from the Middle East and Asia
• Familiarity with structuring catalytic instruments (e.g., first-loss, guarantees, blended capital) to mobilize diverse LP bases

Impact and Systems Expert

• Experience in designing data-driven portfolio and impact reporting systems that align with global standards (e.g., GIIN IRIS+, 2X Global, IFC Impact Principles)
• Demonstrated ability to create scalable reporting frameworks that go beyond headline metrics and integrate financial, impact, gender, and climate resilience indicators

Other specialists (as needed)

• Experts in legal structuring, regulatory compliance, or technical assistance design, depending on the proposed methodology and team composition.

Regional presence

• At least one team member must be based in Africa with demonstrated networks and experience in African capital markets and investment ecosystems.

8. Pricing

The AECF is obliged by the Kenyan tax authorities to withhold taxes on service contract fees as well as ensure that VAT, is charged where applicable. Applicants are advised to ensure that they have a clear understanding of their tax position with regards to provisions of Kenya tax legislation when developing their proposals.

9. Recommended presentation of offer

The technical proposal should include:

1. Understanding of the assignment: A statement demonstrating understanding of AECF’s objectives, including the ambition to build an Africa-based fund management platform, the role of the wholesale lending facility as a foundation, and the emphasis on data-driven systems
2. Methodology and workplan: A detailed description of the approach, methodology, and timeline to deliver the scope of work, including how the consultant will incorporate data and systems at the heart of operations and reporting
3. Team composition and Qualifications: CVs of key experts, including clear roles and responsibilities. At least one team member must be based in Africa with demonstrated local networks and experience
4. Relevant experience: Evidence of prior assignments in fund structuring, capital raising, impact management, or support to emerging fund managers in Africa. At least one client reference letter must be included
5. Capacity building approach: Description of how the consultant will design a roadmap for incubating AECF Capital’s in-house fund management capabilities, leveraging AECF’s track record and infrastructure
6. Risk Considerations: Identification of potential risks to the assignment (e.g., fundraising environment, regulatory hurdles, currency risks, investor appetite, pipeline development) with clear recommendations for mitigation. Consultants should also reflect on how fee structures, pricing, and operational costs can be designed in a transparent manner that ensure sustainability while delivering value to investors and investees.

The financial proposal should include:

• A clear breakdown of professional fees, reimbursables, and applicable taxes
• The final proposal should be consistent with the technical proposal and reflect value for money

Additional requirements:

• Company profile
• Copy of company/firm registration
• Valid tax compliance certificate
• Passport/National Identification and CV or profile of the lead consultant and key personnel

N/B: Technical and Financial proposals should be submitted separately. Combining the financial and technical documents into one document will automatically disqualify the applicant.

10.  Evaluation criteria

AECF will form an evaluation committee. The same standards of confidentiality will bind all members. The consultant should ensure they fully respond to all criteria to be comprehensively evaluated. AECF may request and receive clarification from any consultant when evaluating a proposal. The evaluation committee may invite some or all the consultants to appear before the committee to clarify their proposals. In such an event, the evaluation committee may consider clarifications in evaluating proposals.

In deciding the final selection of a qualified bidder, the technical quality of the proposal will be given a weighting of 70% based on the evaluation criteria. Only the financial proposal of those bidders who qualify technically will be opened. The financial proposal will be allocated a weighting of 30% and the proposals will be ranked in terms of total points scored.

The mandatory and desirable criteria against which proposals will be evaluated are identified in the table below.

11. Application details

AECF is an Equal Opportunity Employer and considers all interested candidates based on merit without regard to race, gender, colour, national origin, religion, sexual orientation, age, marital status, veteran status, disability, or any other characteristic protected by applicable law.

Interested consultants/firms are invited to submit proposals electronically to aecfprocurement@aecfafrica.org with the subject line: TOR: Consultancy for the Design and Structuring of AECF Capital In-House Fund Management Capacity – AECF

The proposal should include:

1. Technical and financial proposals submitted as separate documents
2. All mandatory documents (company/firm registration and valid tax compliance/clearance certificate)
3. At least one reference letter from a comparable assignment

Submission deadline: Proposals must be received no later than 30th September 2025, by 17:00 East Africa Time (GMT +3). Late submissions will not be considered.
Clarifications: Any requests for clarifications of the TOR should be submitted in writing via email to aecfprocurement@aecfafrica.org, no later than 19th September 2025. Responses to all clarification requests will be shared with all applicants to ensure transparency.
Validity of proposals: Proposals must remain valid for a period of 90 days from the submission deadline.

12. Disclaimer

AECF reserves the right to determine the structure of the process, the number of short-listed participants, the right to withdraw from the proposal process, the right to change this timetable at any time without notice, and reserves the right to withdraw this tender at any time, without prior notice and without liability to compensate and/or reimburse any party.

Note: AECF does not charge an application fee to participate in the tender process and has not appointed agents or intermediaries to facilitate applications. Applicants are advised to contact the AECF Procurement Department directly.