The African Development Bank (AfDB) has approved a $7.5 million investment into Africa Tech Ventures (ATV).
The equity investment is part of the Boost Africa Investment Program. A joint collaboration between AfDB, the European Commission and the European Investment Bank - which has already committed US$10 million to the Fund.
ATV states that they "invest between $100,000 and $5million". But, "in exchange for a significant minority equity stake and can take part in multiple financing rounds". The fund will, thus, use the funding to make seed investments in startups that are "operating in key sectors".
The fund's focus of investment is into tech-enabled startups that provide essential goods and services, like education, employment, energy, logistics, agriculture, healthcare and financial services. The goal, according to the bank, is to boost operations of "highly scalable companies" on the continent.
"The overarching goal of ATV is to expand economic opportunities for African youth by providing 15 to 20 start-ups with capital throughout their growth cycle. This will enable them to grow from 1 thousand to 1 million users."
The fund is headquartered in Nairobi office, which explains why a majority of them are also based in Kenya. To date, Africa Tech Ventures - on their website - lists 11 startups as part of their portfolio. These include; Twiga Foods, Sendy, Cellulant, FarmDrive, mSurvey, Eneza Education, Pezesha and more.
Eline Blaauboer, alongside fellow managing partner Mairead Cahill, launched the fund close to two years ago.
Since then, they have been on a drive to close a $50 million fund. According to the press release from AfDB, this particular investment is part of that $50 million. It intends to hold a first closing in the second quarter of 2019 and a final closing 12 months thereafter.
AfDB is increasingly backing funds geared towards high-growth potential startups. In October, the bank announced that they had invested €7 million into Partech Africa Fund. The bank has always stressed that the investments are part of their “efforts to channel critical investment funding to Africa’s entrepreneurs.”
This article had stated that the fund is headquartered in the Netherlands. It has since been corrected to Nairobi.