Montreal, September 2, 2021 - FinDev Canada committed up to US$ 12.5 million in PC Capital Development II L.P. (the Fund), a private equity fund providing growth capital to small and medium-sized enterprises operating primarily in Mexico. PC Capital will invest in companies engaged in financial services, consumer products and services and sustainable industries.
The Fund will inject equity into innovative and scalable SMEs serving a growing middle class that is seeking additional, diverse, and better local products and services.
The Fund will also help SMEs with professional advice to strengthen organizational governance and structure, policies, and operational capacities and fostering a supportive ecosystem that will increase the success potential of each investment.
“We believe that PC Capital will build on the results of its first fund and contribute to growth and job creation in the Mexican economy,” said Paulo Martelli, Chief Investment Officer of FinDev Canada.“ Through our investment and alongside partners such as the IFC, PC Capital will support its portfolio companies to become more gender inclusive and address barriers to women’s economic participation.”
“We are very excited to be able to work alongside FinDev Canada to improve and continue our positive impact in SMEs in Mexico and Latin America,” commented Gabriel Araujo, Pablo Cervantes, and Pablo Coballasi, Managing Directors of PC Capital. “With FinDev Canada as partners, we believe we can develop better ways for our fund to improve the ESG conditions of the companies we invest in, and ultimately help the region’s economy become a more sustainable and healthy place to live in.”
Local economic development
FinDev Canada’s investment will enable PC Capital Development II to further contribute to the development and sustainability of Latin America’s small and medium-sized enterprises that create jobs as they respond to the consumption needs of the region’s expanding middle class.
In particular, the Fund will invest in companies with high-growth potential operating in the financial services, consumer services, energy and retail industries amongst others.
Women’s economic empowerment
In Mexico, only 44% of working age women participate in the labour force, and they face a gender pay gap of over 28%.
PC Capital Development II will promote women’s economic empowerment in the workplace and the marketplace. It will also support gender equality actions in its portfolio companies. The Fund committed to increase women’s representation in its own executive management while also undertaking a gender diagnostic analysis. This transaction qualifies for the 2X Challenge.
Development Finance Institutions and COVID-19
FinDev Canada has a mandate to support companies that have a presence in the areas most affected by the COVID-19 pandemic. Investments will help guarantee that developing markets continue to have liquidity, providing important support for the recovery of the economic and social consequences of this crisis.
About FinDev Canada
The Development Finance Institute Canada (DFIC) Inc., operating under the FinDev Canada brand, is a Canadian institution dedicated to providing financial services to the private sector in developing countries with the aim of combating poverty through economic growth by focusing on three main topics: economic development through job creation, women’s economic empowerment, and climate change mitigation. The Development Finance Institute Canada Inc. is a wholly owned subsidiary of Export Development Canada (EDC).
About PC Capital
PC Capital is a Mexican institution that manages co-investments, direct deals and private equity funds for Latin America. PC Capital is a leading institution for the region in growth capital, and has a proven track record for excellence since its foundation in 2008. PC Capital seeks to invest in high growth social impact opportunities of proven but underdeveloped business concepts and industries.
Delphos International, Ltd., a leading emerging markets financial advisor, served as financial advisor to PC Capital on this transaction.
About the 2X Challenge
The 2X Challenge was founded by the Development Finance Institutions (DFIs) from the G7 as a call to action to shift more capital towards investments that empower women in developing countries to access entrepreneurship and leadership opportunities, quality jobs, and products and services that enhance their economic participation. More information about the 2X Challenge can be found here: https://www.2xchallenge.org.
What’s the criteria for qualifying for a 2X investment?
- Whether a business is majority owned by women or founded by a woman
- The share of women in senior management or on the board
- The share of women in the workforce
- Whether a product or service specifically or disproportionately benefits women
- If a certain percent of loan proceeds in a deal through financial intermediaries supports women.
Head of Marketing and Communications
Private Equity Investment Analyst