Largest fund for African startups unveiled
by AKANI CHAUKE
JOHANNESBURG – THE launch of a €100 million fund, expected to become the largest venture-capital fund focused on digital-technology start-ups in sub-Saharan Africa, is set to accelerate ongoing digital transformation and drive economic growth in the region.
International Finance Corporation (IFC), a member of the World Bank Group, has assisted Partech Ventures launch the fund.
IFC’s €15 million equity investment makes it an anchor investor in the Partech Africa fund, which has reached its first close.
The transaction marks IFC’s first investment in a mainstream venture capital fund in sub-Saharan Africa, where start-ups in the technology sector face significant funding gaps that limit their ability to grow.
Philippe Le Houérou, Chief Executive Officer of IFC, said technology could have a huge transformative impact in Sub-Saharan Africa, which has a vast untapped source of entrepreneurial energy.
He said Arica’s population was overwhelmingly young with lots of people having strong tech skills and innovative ideas that could improve lives.
“But they lack the necessary funding. We think the Partech Africa fund will make an important contribution to closing this funding gap and driving entrepreneurship and growth,” Le Houérou said.
In Africa, digital technology is expected to contribute about $300 billion to gross domestic product by 2025, according to the McKinsey Global Institute.
Tidjane Dème, General Partner for Partech Africa, said after closing more than 70 transactions per year, Partech would bring a great value to
African founders.
“Moreover, thanks to our global network of corporate partners, our dedicated business development team will expose African startups to European and U.S. markets, enabling commercial contracts and long-term strategic partnerships,” Dème said.
The fund will be open to countries across Africa, although eight countries show the strongest need for venture capital, namely Cameroon, Ivory Coast, Ghana, Kenya, Nigeria, Senegal, Tanzania and Uganda.
It will provide early-stage growth funding—in amounts ranging from €500 000 to €5 million—for start-ups in a variety of sectors. These include financial technology, health technology and mobile technology.
– CAJ News
