The UK development finance institution CDC Group has made commitments of $102.8m in four African private equity funds last year.

“Private equity is a key asset class for investors to deploy capital into Africa in a sustainable, responsible and safe manner,” CDC said in its 2014 annual report.

“The various fund types – infrastructure, real estate, SME and generalist – are a proven catalyst for developing the private sector and the principal route for funding high-growth businesses in these markets,” CDC said.

In 2014, CDC committed $40m in Investec Africa Frontier Private Equity II, $32.8m in Africinvest III, $20m in Africa Renewable Energy Fund and $10m in Synergy Private Equity Fund.

In addition, the new commitments were made via the DFID Impact Fund, a £75m pool of capital managed by CDC, which will be invested in funds that back businesses which serve poor people as consumers, producers, suppliers or employees.

In January 2014, the DFID Impact Fund made its first commitment of $15m to Novastar Ventures, a venture capital fund focused on developing and growing early-stage businesses in East Africa.

In August 2014, the DFID Impact Fund committed $15m to a West African agriculture-focused investment fund, Injaro Agricultural Capital Holdings.

In Africa, as well as lacking risk capital, many entrepreneurs struggle to find the right people to help them execute their strategy.

Private equity investors offer a combination of capital and expertise, according to CDC Group.

“As a partner in the business, funds will frequently help nurture and build-out the management team, introducing international best practice in areas such as financial management, energy efficiency or supply chain management,” CDC said.

As well as encouraging growth, this develops the skills of the management team and improves the pool of talent in the market.

With a typical fund making around 10-15 investments, CDC’s investments in private equity funds help distribute capital, skills and know-how across a far wider number of businesses than would be achieved by purely investing directly.

“Having made our first fund commitment in Africa in 1994, CDC today remains the largest supporter of the industry. Our focus on environment, social and business integrity remains a core part of how CDC adds value and our ‘Toolkit for Fund Managers’ plays a key role in raising standards across the industry,” the UK DFI said.

“In spite of the much-vaunted Africa rising narrative, good teams still struggle to attract the capital needed to become viable and sustainable investors, especially those raising specialist funds or targeting smaller deal sizes.”

“Across the market we will continue to back first-time teams, anchor new funds and play an active role throughout the investment cycle,” CDC said.