Naspers Foundry, a R1.4 billion investment vehicle set up by South African eCommerce giant Naspers, has shut down.
According to a BusinessDay report, Naspers did this as it slims operations in the light of dismal venture capital fortunes.
Naspers Foundry invests in early-stage technology companies that seek to address big societal needs. It was involved in Planet42’s $100 million recent raise. Since inception in 2019, Naspers Foundry has invested over R740 million (~$40 million) in nine startups including Naked, Ctrl, SweepSouth, Life Cheq and more.
The group however said it would maintain the investments, including writing follow-on cheques.
According to a Naspers spokeperson, “The global investment environment, as well as the local SA one, has changed, and we have made clear the need for our business to adapt. In line with changes across the wider business, we have reviewed our early-stage investment strategy within SA to bring it in line with our international approach.”
“Naspers will continue to support the development of SA’s early-stage tech sector, assessing the market and new opportunities in a way that is consistent with our other global markets,” the spokesperson added.
Apart from the global economic downturn, Naspers had some local issues. A report from the South Africa’s Competition Commission called out Naspers Foundry as one of some online intermediary platforms that excluded historically disadvantaged persons (HDPs) from South Africa’s Internet economy. The report stated that only 13% of the recipient founders were persons of colour (3 founders) and only 8% were women (2 founders). Meanwhile the company had disbursed R740 million (~$40 million) to 23 founders since 2018.
The commission also blocked some Naspers Foundry deals because it feared that it was becoming too dominant in the South African landscape.
Henceforth, investments in South African startups will be done through Prosus Ventures, Naspers international venture unit.
