entrepreneurship platformA pan-African early-stage venture capital firm, closed its fund at $46 million as it seeks to double “category leading” companies across the continent.
The six-year-old firm, which employs 11 people, initially went to market to raise $40 million for this fund and reached an undisclosed first closure the last December. Most of his limited partners in the first closing were primarily African, which was a deliberate effort, according to the founder and general partner. aina tail.
“It was strategic for us to obtain local capital for our first closing. But the second closure, as you will see, will be from the global fund of funds and the DFIs where we have commitments,” he said in the December interview. “Still, ultimately, as much as foreign capital is critical, I think it is in the interest of foreign capital to be in bed with local capital from a de-risking standpoint.”
Ventures Platform not only exceeded its initial goal, but also introduced the products regarding its next set of limited partners. Standard Bank, Africa’s largest bank by assets, is one of the fund’s newest LPs, as are four development finance institutions (DFIs): the international financial corporation (IFC), the British international investment (BII), Proparco with FISEA and AfricaGrow, a fund of funds managed by Allianz Global Investors. Other limited partners include the social impact company A to Z Impact, corporations, commercial banks, global institutional investors, and high net worth individuals (HNIs).
“No other fund in the region of our type has four DFIs as LP,” Aina told TechCrunch of the addition. “It’s great to have this diverse mix, which is important on a number of fronts, as we can build on their experience and provide our portfolio companies with long-term capital.”
Ventures Platform has made more than 60 investments since its launch in 2016 in sectors such as fintech, insurtech, health tech, edtech, agritech, Enterprise SaaS, digital infrastructure and digital talent accelerators. Some notable names in his portfolio include market strength, infectious mononucleosis, PiggyVestand Nomba and trusted HMOtwo of YC’s most valued African startups.
Most of these investments were made in the pre-seed and seed stages. However, since the first shutdown of this fund, Ventures Platform, which made a full exit during Selling Paystack to Stripe, has upped its game and now writes Series A checks to its portfolio companies, some of which can directly access follow-on capital (Series B onwards) from the company’s limited partners. Aina noted that the Abuja and Lagos-based early-stage company intends to lead the early and seed rounds, investing an average of $250,000 while participating and issuing follow-up checks of more than $1 million in Series rounds. A.
The closure of this fund comes at a time when deal flow activity in Africa has slowed as a result of the withdrawal of local and international venture capitalists amid rising interest rates and reversals in markets. public worldwide. This turn of events is evident in the venture capital figures recorded in both years. For example, African startups grossed just over $5 billion, a figure that many thought would be significantly exceeded at the beginning of 2022; however, in the countdown to the end of the year, it looks like the figure will stay the same or only slightly exceed it.
Startups, in this period, are making efforts to extend their tracks as long as possible and optimize their consumption. And while Ventures Platform has provisions for supporting and scaling its portfolio companies in times like this through a value-added avenue called the “Platform and Networking” practice, Aina, like many investors, is content with the current reset in the African fundraising environment.
“In recent years, particularly in 2020 and 2021, there was a lot of pressure to speed up the processes. But now we are very happy to be where the market is as we see valuations normalize and velocity more reasonable,” the general partner said. “So we are able to carry out due diligence and governance appropriately. We’re being much more deliberate about the type of founders we support because it’s a long-term partnership, taking into account business models and economics and making sure we have enough capital buffers to support our companies.”
Last December, Aina mentioned that the Ventures Platform was strengthening its activity in other markets outside of Nigeria, actively seeking opportunities in regions such as Kenya, Egypt and French-speaking West Africa. The update is that the firm has backed 20 startups in the last year, some of which are from Senegal, Kenya, Uganda and South Africa.
Ventures Platform has also made a number of strategic team onboardings at partnership and senior management levels. First, Damilola Teidithe former director of startup support at the CcHUB incubation center, heads the firm’s Platform and Networking team and Design Chinniahone of eBay’s early engineers and a well-known investor who has backed a few African startups, joins the firm as a venture partner.
LR: Dotun Olowoporoku (managing partner) and Kola Aina (general partner). Image Credits: entrepreneurship platform
Then Ventures Platform welcomes you Dotun Olowoporoku as its managing partner. Olowoporoku is among a small list of tech professionals who have served in founder, investor and operator roles on the mainland. He launched an on-demand food delivery platform in the UK a decade ago, ran Starta, an advisory firm for growing and start-ups on the continent, worked as a director at the Pan-African fund novastar companiesand most recently, he was the commercial director (CCO) in TeamApt backed by QED.
“Kola and I intended to complement each other and take on roles that leverage our strengths, experience, and knowledge,” Olowoporoku said in a chat with TechCrunch. “I am primarily responsible for leading investment management and process, market research and analysis, market research and analysis, portfolio support, communications and ecosystem engagement.” He will work closely with Aina as both partners, widely considered among the most founder-friendly in the Nigerian tech ecosystem, will look to make lucrative bets to help repay this oversubscribed fund.
