In Africa, poor access to financing remains an obstacle to the development of startups operating on the continent. VC Funds are being launched to address that issue and help them grow in underserved markets.

Dutch investment firm Goodwell Investments and Dutch foundation Oxfam Novib announced, Friday, the launch of "Pepea", a joint €20 million ($21.7 million) fund focused on financing early-stage East African startups, specifically in Kenya, Uganda, and Ethiopia.

According to the statement released by Goodwell Investments, the fund will focus on companies in the sustainable agriculture, energy, mobility, logistics, and waste management sectors.

"We acknowledge the challenges faced by SMEs in the region (especially those that are women-owned) in accessing fine-tuned patient capital and we now want to play a role to address those needs," said Tamara Campero, investment manager at Oxfam Novib.

In an analysis published on June 14, 2022, Africa: The Big Deal informed that East Africa was one of the regions with a sufficiently developed venture capital ecosystem on the continent. It attracted nearly 23% of the funds raised by African startups since 2019. Kenya alone attracted most of the funding,  nearly $1.9 billion in two and a half years.

By launching "Pepea," Goodwell Investments and Oxfam Novib want to further develop the region and support startups that are generating revenue but have not yet raised funds. Pepea will ensure that the companies it selects have the right structures and systems to attract more financing. 

Samira Njoya