According to a report from the National Venture Capital Association and PitchBook, VC funds in the U.S. raised $55.5 billion from investors throughout 2018. That is the most since the infamous dot com era. However, this surge in venture capital raised by funds isn’t limited to the United States. It is a global movement with individuals, institutions and economies who are looking to strategically take advantage of the startup wave.
In March this year, Bloomberg reported that French President Emmanuel Macron had pledged to invest 2.5 billion Euros in Africa by means of financially aiding startups and small- to medium-sized enterprises by 2022.
Earlier, in August 2018, British Prime Minister Theresa May said that Great Britain would make major investments in Africa. While on a three-day tour of the continent, May pledged 4 billion pounds ($5.1 billion) of support for African markets. The main goal of Britain's investment will be to harness the "innovation and creativity" of the young people of Africa, May said.
Besides states like Britain and France, global development institutions have shown a keen interest in backing funds looking to invest in African startups.
Last year, the International Finance Corporation (IFC), the African Development Bank (AfDB), CDC Group and the European Investment Bank (EIB) were among the most active development financing institutions (DFIs) acting as Limited Partners, seeding funds targeted towards African startups.
According to Digest Africa data, in 2018, there were 12 funds noted as closed (first, second or final close) targeting Africa startups. These funds, which raised US $740 million, recorded the participation by the DFIs noted above in at least 7 funds.
For example, at least two Africa-focused VC funds have reached a close with the support and participation of the EIB and AfDB: the US $143 million Partech Africa Fund and $40 million TLcom Tide Africa Fund, while CDC Group was an investor in the US $72.5 million Novastar II Fund.
However, these institutions - particularly EIB, are not about to slow down. Ivory Coast-based Janngo - which describes itself as Africa’s first startup studio - is about to become the latest beneficiary of the bank’s spending spree trend.
Digest Africa got ahold of documents indicating Janngo is currently raising a fund called Janngo Capital Startup Fund. The fund has a target size of EUR 50 million (~ USD 56 million) with a keen focus on sub-Saharan Africa - especially West Africa. The European Investment Bank is looking to be a limited partner with an approximate EUR 12 million investment in the fund.
“The fund will be set up to support new startups in the digital and technology sectors (high-tech companies), with the main focus on Sub-Saharan Africa.”
According to Tim Smit from EIB, the bank is yet to make the decision regarding the investment, though he pointed out that the “opportunity [to invest] is [being] considered by the EIB as it fits the objectives of the Impact Envelope under the ‘Cotonou mandate’”.
The Janngo team is led by Fatoumata Ba who also doubles as the Chief Executive Officer. She is mostly known for launching Jumia in Ivory Coast which she ran from 2013 to 2015 according to her LinkedIn profile. Ba then went ahead to serve as the General Manager of Jumia in Lagos, Nigeria for a year from 2015 to 2016.
There are no other details regarding who else will be a part of the Janngo Capital Startup Fund team. However, Tim pointed out that the “team is still under construction”. Digest Africa contacted Fatoumata via email regarding the fund, but there was no response by the time of publication.
There are no details related to when the fund will close as the process of raising is still in the early stages. Though Janngo Capital Startup Fund is expected to be a generalist in terms of sectors with a “strong innovative/digital focus”. The Fund will mainly focus on investments in venture capital from seed to series B.
In May last year, Janngo raised a EUR 1 million Seed round “to shape digital ecosystems and create pan-African tech champions”. Mulliez Family - a family office, Clipperton, an Investment bank and Soeximex - a leader in international trading supporting access to consumer goods in West Africa were the investors. Following the closure of the round, it went ahead and launched its Paris and Abidjan offices.