SOLON CAPITAL PARTNERS
Solon Capital Partners (SCP) owns a portfolio of companies that operate across a range of sectors in West Africa, including transportation, real estate and construction, logistics, and affordable education.
SCP seeks to maximise “risk-adjusted” returns. The critical word in that statement is “risk”. Many investors spend their time focusing on returns, on the upside of an investment. We believe the upside story is the easier half of the equation. In under-developed economies such as Sierra Leone, with so much untapped potential, the scale and breadth of opportunities for investors is self-evident. The challenge is how best to manage risk; how to anticipate pitfalls, withstand market volatility, and overcome unforeseen challenges. Investors who fail to recognise this reality are doomed to failure.
The Ebola crisis, and the recent period of commodity price volatility, highlighted this fact. With such a small economic base, exogenous events – such as movements in global commodity prices or a health crisis – can drive market volatility of immense proportions. But over the long term, volatility can prove to be as much a friend as foe. That’s why SCP’s focus is on mitigating downside risk by actively managing defensible businesses; companies that can withstand cyclical downturns are then best placed to capitalize on the prolonged cyclical upturns which follow. For ultimately, what is a more telling indicator of Sierra Leone’s future economic performance – the struggles of the Ebola crisis, or the decade of exemplary economic performance which preceded it?
SCP is committed to Sierra Leone for the long-term. We know that our investment performance will experience volatility, for both good and for bad, but we have conviction in the long-term economic trajectory of the country. It is firmly on the path from being a small-scale agrarian economy to a middle income one; the world over, we have seen such transitions drive exemplary returns on investment, and we believe that Sierra Leone will be no different. In the meantime, we will continue to invest in our people, invest in our business infrastructure, and work where we can to facilitate improvements in transparency and the climate for investment.
It is a commitment of both time and money but ultimately a compellingly commercial one; and, as such, one we are more than happy to make.
ABOUT SOLON CAPITAL PARTNERS
Solon Capital Partners is an Africa-focused investment and advisory firm based in Freetown, Sierra Leone. It seeks to maximise risk-adjusted returns for its investors by developing and actively managing high-growth, defensible businesses that are fundamental to developing markets.