The pan-African fund will go towards tech and tech-enabled businesses, offering them investment as well as mentorship and access to greater resources.
Leading Africa-focused venture capital (CV) firm Atlantica Ventures raised a $50 million fund for investment in tech and tech-enabled businesses from the seed stage onwards.
Atlantica Ventures was founded in 2019 by Aniko Szigetvari and Ik Kanu, who have in the past worked for likes of IFC, Helios and Convergence, and have extensive investing experience. The firm’s portfolio includes Paystack, recently acquired by Stripe, and Sendy.
The $50 million pan-African VC fund is financed by development financial institutions, a U.S fund of funds and numerous high net-worth individuals. African Ventures has already used part of the fund to invest in Nigerian startups Curacel and OnePipe and will continue investing in other tech and tech-enabled businesses at the seed stage. They invest in startups that are offering solutions to critical local problems and have demonstrated product market fit with the potential to scale on a global scale.
The firm’s main target markets are Nigeria, Kenya, South Africa, Ghana, Ivory Coast and Tanzania, which collectively represent 60% of Africa’s total GDP, with a focus on fintech, logistics, agri-tech, digital security, IoT and B2B marketplaces.
“These are significant contributors to the target markets’ GDPs and are interlinked, allowing for value chain/platform investing,” Kanu said. “These sectors also exhibit some recession fluidity, and are aligned with the future-of-work. COVID-19 has accelerated the adoption of technology across our target markets, and these sectors have been pivotal to the economies.”
The firm encourages their portfolio companies to work together to maximize value. Its African and global networks also help facilitate these companies’ scaling and expansion efforts in other markets and regions. Atlantic Ventures is a mentor and partner to the startups, not merely an investor. The firm partners utilize their extensive experience in growing companies from the early stage to growth by taking on a more hands-on operational role.
“We invest from seed to Series B rounds with a data-driven approach for investment opportunity evaluation and portfolio management. These startups are solving essential local problems and have demonstrated product market fit with the ability to scale globally,” Kanu stated.
Kanu emphasized that African entrepreneurs often face “access” challenges. That is, access to capital, markets, strategic partners, and knowledge. Atlantica Ventures benefits from its partners’ connections with global investors and development financial institutions to help solve these access challenges.