AfDB invests $10.5 million in Seedstars Africa Ventures

After receiving a capital commitment of $30 million from EIB Global, an affiliate of the European Investment Bank, Seedstars Africa is poised to receive an additional investment of $10.5 million from the African Development Bank (AfDB).

This new injection of funds, part of the Seedstars Africa Ventures I fund, will offer increased support to innovative, high-growth businesses. It will also enable the venture to attract more capital, broaden its reach across Africa, and appeal to potential investors.

The AfDB plans to funding $7 million from its standard resources, alongside $3.5 million from the European Union’s Boost Africa initiative. The latter programme, launched by the AfDB and EIB in 2019, empowers young Africans to establish impactful, innovative businesses that can compete globally, thereby fostering job creation and economic growth.

It falls under the umbrella of the Jobs for Youth in Africa Strategy 2016–2025, managed by the AfDB.

According to a recent statement, this new investment is anticipated to significantly impact the economy while creating around 9,000 full-time positions, half of which will be dedicated to women. Earlier in 2023, on January 10, the venture announced a $30 million capital commitment from EIB Global to bolster seed and Series A startups.

This assistance will help address a substantial capital shortage and support startups beyond the bounds of the accelerator programme.

The Seedstars Africa Ventures I fund was initiated in 2020 by trio Maxime Bouan, Tamim El Zein, and Bruce Nsereko Lule, in collaboration with LBO France and Seedstars. The latter is a global company that backs and aids entrepreneurs from emerging markets.

Seedstars Africa Ventures focuses on investing in companies that tackle significant market issues, generate revenue, and demonstrate potential growth. So far, with the support of major corporate and institutional investors, the fund has invested over $7 million in 25 startups across Sub-Saharan Africa.

The fund’s primary investment focus is early-stage, high-growth companies addressing challenges in markets traditionally underserved by investors. While its focus is mostly on French-speaking countries, such as Senegal, Côte d’Ivoire, Benin, and Cameroon, it also invests in other African countries, including Ghana, Uganda, and Tanzania.

Seedstars Africa Ventures aims to invest a total of $75 million in startups and businesses that can overcome significant market barriers. Initially, an investment of about €250,000 is made, with further injections of up to €5 million to foster growth.