Contribution of Private Equity Investments on the Growth of Micro Enterprises: A Case of Disability Fund in Zanzibar

Abstract

The main objective of this study was to examine the contribution of private equity investments on the growth of Micro Enterprises in Zanzibar. Specifically, the study examined the contribution of expertise offered by private equity investments on the growth of Micro Enterprises, assessed the contribution of financial resources offered by private equity investments on the growth of Micro enterprises and proposed measures for improving private equity investments for the growth of Micro enterprises in Zanzibar. This study employed both quantitative and qualitative approaches in the collection of relevant information. Descriptive design was useful for collecting data and techniques used in analysis. Simple random samplings were employed during the study. Data were collected by using questionnaire and document review. Validity and reliability of the data were tested showing the Cronbach’s Alpha,KMO and Bartlett's Test. SPSS version 25 and excel Microsoft application were used to process data. Study findings revealed that that Result indicated that there is an R2 value of 0.897%. This value indicated that three independent variables (Expertise, Financial resource and Measures) explain 89.7% of variance in Micro-Enterprises Growth. It therefore means that 10.3% of changes in Micro-Enterprises Growth are explained by many other factors not considered in this study model. Thus the study recommends that Micro Enterprises should organize their investment portfolio of private equity so that maximum returns are reached with lower risks. The maximum profits would allow businesses to draw more investors and promote their financing processes.