France's Cathay Capital and AfricInvest will be launching a $168 million fund for African tech startups. It becomes Africa's 52nd fund, joining the league of VC's with over $1 billion funds invested in technology.
Tunisia based private equity firm Africinvest has teamed up with global private equity firm Cathay Capital to launch a new Africa focused tech fund with a target raise of $168 million.
Co-founder of the fund Denis Barrier revealed that the Cathay Africinvest Innovation Fund will focus primarily on series A to C stage investments in African technology companies. The fund will be focusing on areas such as fintech, logistics, AI, agtech, and edutech.
Barrier was not forthcoming on the details on when the fund would close. However, he did confirm that investments would begin rolling in as early as the mid-2019. He expects to see strong local showing for startups from across Africinvest’s 10 country offices in Abidjan (Côte d'Ivoire), Algiers (Algeria), Cairo (Egypt), Casablanca (Morocco), Dubai (UAE), Lagos (Nigeria), Nairobi (Kenya), Paris (France) and Port Louis (Mauritius), and Tunis (Tunisia). The firm will open an office in Johannesburg in the near future, according to a company release.
The new fund represents a broad scope in capital and experience when taking into account the strengths of the two founding companies. Cathay Capital currently has $2.5 billion of assets under its management with offices in the U.S., Europe, Asia, and the Middle East. and offices in the U.S., Europe, Asia, and the Middle-East. Africinvest has an estimated $1.2 billion in assets under management according to information listed on its website.
According to CrunchBase, Africinvest’s 46 venture and debt investments span the brick and mortar side of many of the sectors the new tech fund looks to target, including education and banking. Since 1994, AfricInvest has invested in 150 companies across 25 African countries in a variety of high growth sectors and maintains a broad network of high-quality executives across Africa, offering extensive expertise in key growth industries, including financial services, agribusiness, consumer/retail, education and healthcare.
With the line between banks and fintech also starting to blur in Africa, that could lead to an advantage for the Cathay Africinvest Innovation Fund in sourcing deal flow.
The new investment group enters during a period when investment rounds and the number of funds focused on African startups continues to grow rapidly, reaching a total of 51 funds in 2018. Total venture capital from these funds to African start-ups surpassed which surpassed $1 billion for the first time in 2018 according to Partech. This represents a one-hundred percent increase in VC to Africa over a four-year period.
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