African SMEs raising growth capital often focus on the wrong things. They obsess over their pitch deck, their valuation, and their projected revenue trajectory. These matter – but they are not what causes deals to fall apart.
What causes deals to fail
After advising on dozens of African capital-raising mandates through Bean Tree Partners, we have observed the same recurring pattern: deals fall apart at the diligence stage, not the pitch stage.
Investors get excited about the opportunity. They commit to diligence. And then they hit something – incomplete management accounts, unclear ownership structures, unresolved tax positions, weak governance – and they walk away.
What investor readiness actually means
- Clean, IFRS-compliant management accounts going back three years.
- A clear, documented capitalisation table.
- Resolved tax positions, with no contingent liabilities lurking.
- A governance structure an institutional investor can recognise.
- A management team that can articulate the business model in terms an investor cares about.
How Bean Tree helps
We work with founders to build this infrastructure before they go to market. By the time we take a client to investors, the question is no longer whether the business can survive diligence – it is which investor offers the best terms.