Japan’s heavyweight in venture capital, SBI Holdings, and Africa’s premier VC investor, Novastar Ventures, have embarked on a monumental strategic partnership. The alliance sees a substantial $40 million multi-fund investment from SBI Holdings, aimed at anchoring Novastar’s future funds.
This partnership goes beyond mere monetary terms. SBI Holdings aims to rally additional matching commitments from other influential Japanese institutional investors for Novastar’s funds. In return, Novastar, with its established footing and market intelligence in Africa, will offer co-investment avenues and provide invaluable market insights. While SBI Holdings’ investment ensures it a minority stake in Novastar, the core management and control of Novastar will remain with its four original partners. However, marking the partnership’s significance, SBI Holdings will be occupying a non-executive seat on Novastar’s Management Board. To spearhead the partnership’s goals, Riki Yamauchi, having transitioned from an illustrious investment banking career in Tokyo to Nairobi in 2022, will join Novastar’s team.
Yoshitaka Kitao, the top-tier executive of SBI Holdings, lauds Africa’s potential. He remarks, “Africa, with its fast-paced growth, tech-inclined youth, natural assets, and urban evolution, stands at the threshold of global leadership in sustainable development.” He further acknowledges Novastar’s pivotal role in the African VC landscape and envisions this partnership as a robust conduit between Japan and Africa, fostering financial growth, knowledge transfer, and innovative collaborations.
On the other end, Steve Beck, the Co-founder and Managing Partner at Novastar, recalls the nascent VC landscape in Africa a decade ago. He notes the exponential growth in venture funding, which has seen a twenty-fold increase, surging past $5 billion in 2022. But for Beck, this is just the beginning. He believes that in collaboration with corporate stalwarts like SBI, Africa can leapfrog traditional polluting methods and carve a sustainable and equitable future. “To bring this vision to life, we need the technological prowess and long-term vision of established economies like Japan,” Beck adds.
Since its foundation, Novastar has successfully secured over $200 million from global institutional patrons. Its portfolio stands testimony to its commitment. Companies under its wing have ushered in enduring social value for over 50 million individuals, a significant portion of whom survive on minimal daily incomes. In addition to social contributions, these companies are environmental champions, tackling greenhouse gas emissions, fostering soil health, and bolstering biodiversity.
Highlighting the significance of such collaborations, Abi Mustapha-Maduakor, the CEO at AVCA – The African Private Capital Association, states, “This partnership between leading VCs from Japan and Africa augurs well for both regions. Africa’s potential, backed by its young demographic and abundant natural resources, is immense. But to channelize this into green growth, it needs resilient capital.”
To drive home Novastar’s impact, one needn’t look further than its portfolio. Moniepoint, Nigeria’s foremost business bank, featured second on the Financial Times’ 2023 list of Africa’s rapidly expanding companies. BasiGo holds the crown as Africa’s predominant electric bus platform. Meanwhile, mPharma paves the way in healthtech, democratizing access to primary care and reigning as the chief community pharmacy operator in Sub-Saharan Africa.
In conclusion, this partnership between SBI Holdings and Novastar Ventures isn’t just a merger of funds; it’s a fusion of visions, ambitions, and a shared commitment to a sustainable and prosperous future.
