Seedstars Africa Ventures, an early-stage venture capital fund investing in high-growth companies active across Sub-Saharan Africa, has received $30 million from EIB Global, to invest in Entrepreneurs and early-stage startups in Africa.
The fund will be invested in companies developing and implementing digital technologies, particularly those addressing basic needs such as education, healthcare, and utilities, or enhancing goods, services, and efficiency.
Additionally, tech startups will also receive a portion of funding, and innovative brick-and-mortar businesses that get an unfair advantage from digitalization.
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The fund also plans to invest up to 50% in Francophone Africa, a region that continues to be an investment destination for emerging VCs owing to lower competition, a massive market opportunity, and high-quality and better-priced deals, in comparison to the more mature Anglophone regions.
Commenting on the investment, EIB head of regional hub for East Africa, Edward Claessen highlighted the importance of backing funds in Africa saying they play an important role in growing and strengthening the continent’s startup ecosystem. He further noted that funds like Seedstars Africa Ventures are invested in the continent and back founders that create jobs and contribute to the growth of economies.
Also speaking on the investment, EIB Vice-President Ambroise Fayolle, said,
“Encouraging and promoting innovation and digitalisation 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.”
It is worth noting that the US$30 million EIB Global investment is backed by the EU, through US$20 million from the ACP Trust Fund and US$10 million from the Boost Africa program. With this investment, the EIB has now fully deployed Boost Africa, a program launched in 2016 with the aim of boosting sustainable jobs and prosperity through venture capital for African entrepreneurs.
Boost Africa is a joint initiative of the European Investment Bank and the African Development Bank to enable and enhance entrepreneurship and innovation across Africa, supported by the European Commission and the Organisation of African, Caribbean, and Pacific States.
Under Boost Africa, the companies invested in by Seedstars Africa Ventures 1 will also benefit from technical assistance to develop business skills and expertise, funded by the EU
The EIB pillar of the Boost Africa programme comprises senior and junior tranche investments into venture capital funds in Sub-Saharan Africa and provides guidance and expert advice to both funds and investee companies.