Seedstars Africa Ventures secures $30 million from EIB Global to invest in startups

Seedstars Africa Ventures, a venture capital fund focusing on early-stage investments in high-growth companies operating throughout Sub-Saharan Africa, has secured a capital commitment of $30 million from EIB Global, a subsidiary of the European Investment Bank.

This substantial funding comes on the heels of an $8 million investment from French private equity firm LBO France, the anchor investor for the venture capital fund.

Seedstars Africa Ventures, based in Paris and Nairobi, is positioning itself as a pivotal player in the African startup ecosystem. The fund, which aspires to close between $80 million and $100 million, is targeting early-stage startups in their seed and series A stages. Importantly, it extends its support beyond these initial stages, providing follow-on funding up to Series B.

Collaborating with the Seedstars Group, an emerging markets accelerator with a robust presence in Africa, the VC firm aims to leverage the accelerator’s infrastructure and market access. This strategic partnership taps into the vast potential of the African market and aligns with the fund’s goal of bridging funding gaps, especially in regions beyond the prominent four – Egypt, Kenya, Nigeria, and South Africa.

Maxime Bouan, Tamim El Zein, and Bruce Nsereko Lule, the partners spearheading the VC firm, emphasize the need for a more extensive capital pool beyond traditional acceleration programs. The larger-than-average fund for Africa is positioned to meet the diverse capital requirements of entrepreneurs on the continent, offering support and resources beyond mere financial backing.

Seedstars Africa Ventures plans to make initial investments ranging from $250,000 to $2 million, with follow-on funding reaching up to $5 million for up to 30 startups. This support extends beyond monetary contributions, providing entrepreneurs access to Seedstars’ extensive tools, networks, and visibility.

While the fund remains sector-agnostic, it expresses a keen interest in startups addressing fundamental needs such as education, healthcare, and utilities, along with those enhancing goods, services, and efficiency. The VC firm is open to tech startups but also embraces innovative brick-and-mortar businesses gaining advantages through digitalization.

In a unique approach, Seedstars Africa Ventures plans to allocate up to 50% of the fund to Francophone Africa, recognizing the untapped potential in this region. The investment, backed by the EU’s ACP Trust Fund and Boost Africa program, emphasizes the importance of supporting funds in Africa to nurture startup ecosystems and contribute to economic growth.

Seedstars Africa Ventures has already made significant strides with initial investments in businesses like Kenya’s Poa Internet, Nigeria’s Beacon, Shamba Pride in agritech, and Bizao in payments, thanks to the backing from LBO France. With the additional funding injection, the VC firm is poised to accelerate its investments, making a lasting impact on the African startup landscape.

Beyond this pan-African fund, the broader Seedstars Group has also demonstrated its commitment to African startups, having invested in 26 companies through its Seedstars International Ventures Funds I and II. As these investments unfold, the stage is set for a transformative journey in African entrepreneurship, driven by strategic partnerships and substantial capital commitments.