The African startup scene is witnessing a significant expansion, with emerging markets across the continent experiencing increased activity. As the market continues to grow, there is a growing need for more local fund managers to provide additional capital and support to founders.
Key Takeaway
Local African VCs are stepping up to fill the gap left by foreign investors, empowering local talent and driving impact in the continent’s startup ecosystem.
Foreign Investment Dominance
Foreign venture capital firms have historically dominated the African investment landscape, accounting for 77% of total funding in 2022. While the presence of global heavyweights like Softbank and Khosla Ventures has brought international attention to the region, it has also highlighted the need for local sustainability.
Shift Towards Local Fund Managers
With foreign interest fluctuating in response to market conditions, there has been a noticeable shift towards local fund managers. Entities such as Dream VC, the Obuntu Foundation, and the Africa Venture Philanthropy Alliance are actively bridging the gap by cultivating the next generation of fund managers in Africa.
Empowering Local Talent
Programs like Dream VC’s investor accelerator and Obuntu Foundation’s Launchpad are equipping professionals with the necessary skills and resources to launch and manage funds within the African startup ecosystem. These initiatives aim to democratize venture capital and enable local talent to play a pivotal role in dealmaking.
Driving Impact
These programs have already begun to yield positive results, with alumni making significant contributions to Africa-focused investment firms. The hope is that these new fund managers will attract fresh funding from both local and foreign sources, ultimately benefiting the continent’s startups.
