AFRICA – The Board of Directors of the African Development Bank (AfDB) has endorsed a US$10.66 million equity investment to stimulate venture capital investments in African entrepreneurs at all stages of development.
The African Development Bank (AfDB) will provide US$7.62 million from its own funds to the equity fund, while the European Union (EU) will invest US$3.05 million in partnership with the Organization of African, California, and Pacific States (OACPS).
Cathay-AfricInvest Innovation Fund will use the funds to help it reach its aim of raising US$119.7 million to invest in over 20 early-stage businesses in Sub-Saharan Africa.
Financial inclusion, logistics, and retail system for mobile and online users, pay-as-you-go, healthcare innovations, and off-grid energy solutions are among the areas where the Innovation Fund concentrates.
The Innovation Fund has lately expanded its focus to include start-ups that are profiting from the emerging digital opportunities presented by the Covid-19 epidemic, or that have a strong potential to contribute to the coronavirus fight.
The Mauritius-based Fund is co-sponsored by AfricInvest Capital Partners and Cathay Innovation SAS.
“The Bank’s clearance signals another key step forward in the integration of the Boost Africa Program and its partnership with the EU, OACPS, and the European Investment Bank,” said AfDB Director for Financial Sector Development Stefan Nalletamby.
“It illustrates the importance given to Africa’s tech-enabled rising entrepreneurs, as well as the significant role played by AfricInvest and Cathay Innovation in aiding this important business segment in attaining Africa’s growth, reform, and integration aspirations.”
Over 40% of the initiatives in its current pipeline span multiple African regions. West Africa accounts for a third of the start-ups in which it invests. One-quarter of all shareholder start-ups are in the healthcare industry.
AfricaGrow of Germany’s KfW/Allianz GI, Swiss impact investor Obviam as well as France’s public investment bank BPI and development financing organization Proparco, as well as are among the other investors.
The assistance provided by the Bank is expected to speed the creation of a new era of accomplished African entrepreneurs who would serve as role models for relatively young innovators.
It will also assist young and female-led start-ups, as well as extend access to financial and “real sector” goods and services, using appropriate technology and innovation.
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