Despite a downturn in sector investment, Africa’s tech ecosystem continues to draw interest. The continent is seeing an influx of new investors keen to support innovative start-ups.

BEI Monde, a subsidiary of the European Investment Bank (EIB), has pledged a $30 million investment in the Seedstars Africa Ventures I venture capital fund, as announced on Wednesday, January 10. This initiative is backed by the secretariat of the Organization of African, Caribbean, and Pacific States (OACPS) through the Boost Africa program with a contribution of $10 million, and by the European Union via the ACP Trust Fund with a sum of $20 million. The objective is to spur growth and job creation across the continent by investing in businesses that utilize digital technologies to provide essential services and enhance business efficiency. 

“Encouraging and promoting innovation and digitalization is crucial to developing strong and sustainable economies. African entrepreneurs hold the key to the continent’s future, creating jobs, reducing inequality, and improving quality of life. The EIB, as part of Team Europe, is committed to supporting African businesses, and we are proud of the success of Boost Africa and the ACP Trust Fund,” stated EIB Vice-President Ambroise Fayolle. 

Despite a 36% decrease in fundraising by African startups to $3.2 billion by 2023, as reported by TechCabal Insights, the introduction of a new venture capital entity focused on Africa is a positive development. Startups can now access this fresh funding source to realize their projects and/or initiate their startup’s growth phase.

Most investors active on the continent are drawn to the tech ecosystems of Kenya, South Africa, Egypt, and Nigeria. In 2023, startups from these four countries represented 74.9% of financing rounds on the continent. The first four deals of Seedstars Africa Ventures I affirm this trend, with the fund backing two Kenyan startups (Poa! Internet and Shamba Pride), one Nigerian (Beacon Power Services), and one French (Bizao) startup with a focus on Africa.

Adoni Conrad Quenum