Partech Africa II: Empowering African Startups with €280 Million
Partech closes second Africa fund at €280 million ($300 million+), solidifying its position as the largest Africa-focused fund.
Partech raised over $300 million for its second Africa fund to invest in startups from early stages to Series C.
🌍 Partech, a global venture capital firm, has recently closed its second Africa-focused fund, Partech Africa II, at a whopping €280 million ($300 million+). This significant achievement solidifies Partech Africa’s position as the largest fund dedicated to African startups. 🎉
The Decline in Investor Activity
Amidst a backdrop of global VCs and institutional investors pulling back from Africa, the closure of Partech Africa II marks a ray of hope for the continent’s startup ecosystem. According to a report by Partech, investor activity in Africa witnessed a sharp decline of 50% in 2023 compared to the previous year. This retreat, influenced by global economic shifts and local challenges, translated into reduced venture capital inflows for African startups.
Last year, African startups received funding between $2.9 billion and $4.1 billion, a decrease from $4.6 billion to $6.5 billion in 2022. Seed stage deals decreased by 33% and growth stage deals by 39%. In these challenging times, Partech Africa’s focus on seed to Series C rounds offers stability and support for startups navigating the stormy waters. 🌊
Partech Africa’s Commitment to Support Founders
Partech Africa’s general partners expressed their dedication to supporting founders at various stages of their journey. Cyril Collon, one of the general partners, highlighted the criticality of anchoring rounds at all stages, from seed to early growth. This commitment to fostering growth and providing capital is more crucial than ever.
The venture capital firm has expanded its team to effectively deploy capital and offer assistance to portfolio companies. With offices in Dakar, Nairobi, and Dubai, Partech Africa has recently established a presence in Lagos, further solidifying the city’s significance as a startup hub. The majority of the second fund will be deployed between Series A and B rounds, showcasing their strategic approach to investing and supporting startups. 💪
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Investments from Partech Africa II
Partech Africa II has already made some exciting investments. One such investment is Revio, a South African payment orchestration platform. Partech Africa co-led the seed round alongside global fintech fund QED. Furthermore, the fund has made undisclosed investments in an Egyptian proptech and a Senegalese e-commerce startup. The fund aims to back over 20 companies, making initial investments ranging from $1 million to $15 million. These investments align with Partech Africa’s focus on sectors such as fintech, agritech, health tech, retail, FMCG, and agency banking, which are crucial for Africa’s employment and economic activity. 🌱💲
Partech Africa’s Investor Base
Partech Africa II boasts a diverse investor base. During the initial close, development finance institutions, commercial investors, African fund-of-funds, and family offices were among its limited partners. For the second close, the fund attracted participation from U.S. and Middle Eastern pension funds, sovereign funds, the Dubai Future District Fund (DFDF), and the African Reinsurance Corporation (Africa Re).
The reinvestment and increased commitment from almost all Fund I investors is an acknowledgment of the trust and success garnered by Partech Africa. Additionally, the fund has received support from a new set of strategic investors, marking their first commitment to African tech. This influx of capital and confidence from diverse investors demonstrates the growing interest and belief in Africa’s potential for growth and innovation. 🌟
The Growing Landscape of African-focused Funds
Partech Africa II is among several noteworthy funds that have emerged on the continent in the past year. Despite challenges in raising capital, African fund managers have witnessed successful fundraising efforts. Other notable funds include Norrsken22, Al Mada, and Novastar’s Africa People + Planet. Moreover, firms like Enza Capital, Equator, Knife Capital, and E3 Low Carbon Economy Fund for Africa (E3LCEF) have closed sizable funds. These developments reflect the continued investor interest in Africa’s promising growth potential. 📈
Q&A: Addressing Reader’s Concerns and Curiosities
Q1: How can Partech Africa II help African startups during challenging times? Partech Africa II, with its focus on seed to Series C rounds, provides stability and support for startups navigating the challenging investment landscape in Africa. By anchoring rounds and providing capital at critical stages, they empower founders to grow and thrive.
Q2: Which sectors does Partech Africa prioritize? Partech Africa focuses on crucial sectors such as fintech, agritech, health tech, retail, FMCG, and agency banking. These sectors play a vital role in driving employment and economic activity in Africa.
Q3: How diverse is Partech Africa’s investor base? Partech Africa II boasts a diverse range of investors, including development finance institutions, commercial investors, African fund-of-funds, family offices, U.S. and Middle Eastern pension funds, sovereign funds, the Dubai Future District Fund (DFDF), and the African Reinsurance Corporation (Africa Re). This diverse investor base reflects the global interest and confidence in African tech.
The Future of African Tech
The closure of Partech Africa II reinforces the future growth and potential of the African tech ecosystem. With significant investments in key sectors and continued interest from global investors, African startups are poised to make a lasting impact. As more funds like Partech Africa emerge and concentrate their focus on the continent, the dynamic landscape of African tech will continue to evolve and flourish. 🚀
🔗 Relevant Links: – How African startups raised funding in 2023 – Partech hits first close of largest Africa-focused fund, at €245M – Partech is doubling the size of its African venture fund to $143 million – Africa-focused funds find their feet amid a downturn – Inception Capital closes flagship $30M fund focused on crypto, emerging managers
We’d love to hear your thoughts on Partech Africa II and the future of African tech! Share your opinions, experiences, or questions in the comments below. Don’t forget to hit the share button and spread the word about this exciting development in the African tech ecosystem. 📲💬 Let’s empower African startups together!
