Verod-Kepple Africa Ventures (VKAV) plans to back up to 21 growth-stage companies on the continent after raising its first fund of $60 million. The pan-African venture capital firm achieved this milestone after securing new support from Nigeria’s SCM Capital (formerly Sterling Capital Markets Limited) and the only non-Japanese investor. Other recent investors (limited partners) include Taiyo Holdings and C2C Global Education Japan.

The new capital infusion follows the fund’s first and second capital injections in 2022 and last year, respectively, from investors including SBI Holdings, Toyota Tsusho Co., Ltd., Sumitomo Mitsui Trust Bank, Japan International Development Agency and Japan Major Japanese institutions such as the ICT Fund.

Verod-Kepple is the latest African venture capital firm to secure capital amid an ongoing investment slump, allowing it to provide much-needed funding to Series A and Series B startups, although capital pools for local growth-stage companies remain limited.

“We have seen growth in pre-seed and seed funding over the past few years, but we believe there is not enough capital in the growth stage of investment to take these companies to the next level in terms of scale, exit or growth . and even become a sustainably profitable business,” VKAV partner Ory Okolloh told TechCrunch.

“Our focus is Series A and Series B, but we have the ability to advance to pre-Series A earlier if we think it is a good opportunity. We think there is still a need for local investors to provide more growth-stage capital,” she explain.

The venture capital firm was founded in 2022 by Okolloh, Ryosuke Yamawaki and Satoshi Shinada as a joint venture between private equity firm Verod Capital and Tokyo-based venture capital firm Kepple Africa.

The venture capital firm said the fund needed to collaborate in order to provide meaningful practical support to portfolio companies in their expansion stages, including bringing operational best practices, improving governance structures and navigating Africa’s complex macroeconomic environment. Verod-Kepple noted that as more startups move from pre-seed and seed stages into Series A and B and later stages, their transformation and success at scale will require a more institutionalized approach, proposing This view.

How to invest in VKAV

The VKAV Fund supports startups that are building infrastructure for the digital economy and solving inefficiencies experienced by businesses and market creators of emerging consumer groups. Okolo said their focus on the latter is to support companies targeting shifts in consumer trends.

The venture capital fund, which invests between $1 million and $3 million with the ability to follow through, has deployed $17.5 million, investing an average of $1.5 million in 12 companies from Nigeria, Egypt, Kenya, Morocco, Côte d’Ivoire and South Africa. Investment targets include financial technology, mobility, e-commerce, real estate technology, deep technology, insurance technology, energy and healthcare, including Uber-backed Moove Africa, climate technology scale-up KOKO Networks, Nigerian shared mobility startup Shuttlers, aerospace startup Cloudline, Moroccan B2B e-commerce and retail startup Chari, and insurtech mTek-Services.

While the fund is industry agnostic, it is looking at vertical ERP startups and those that offer embedded financial services and players in the future of work space. They are also “increasingly applying an AI lens to understand how a new generation of AI as infrastructure will transform the production and distribution of technology-enabled enterprises.”

Okolloh said the fund plans to continue to explore other ecosystems, including Angola, Zambia, Democratic Republic of Congo and Tunisia, through its team or partner investors, to identify new investment opportunities, particularly in underserved markets, and to continue its pan-African push business.

“We believe it is important to take a pan-African and industry-agnostic approach given the diversity of the market, macroeconomic changes and markets that are underserved by investors,” said Okolo, an executive at Omidyar Network and Google Africa.
“We’re definitely looking at diversity in the portfolio, not just in terms of gender and founders, but also in terms of industries and markets.”

The Verod-Kepple fund joins a growing number of African venture capital funds backed by Japanese institutional investors seeking to diversify risk. Recently, Novastar Ventures also secured capital commitments from MOL Group and SBI Holdings.

“As investors, the connection to Japan is important, and we hope to expand that to broader Asian connections in the future. I think immersing yourself in the stories and experiences, and working with investors and other partners from the market, allows you to It’s critical to be able to see the economy transform during our lifetime,” Okolloh said.

“I’m grateful for the opportunity to learn, collaborate, share and even connect with different parts of the world, making their experiences even more relatable. Most importantly, supporting exceptional founders in meaningful ways so they can thrive.”

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