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Partek has closed its second Africa fund, Partech Africa II, on €280 million ($300 million+), just a year after reaching its first close.
at that size, Partech Africawhich was originally intended €230 million Even before its fundraising efforts began, it has solidified its position as the largest fund dedicated to African startups.
Partech Africa’s recent fund close is significant, amidst the backdrop of global VCs and institutional investors turning away from Africa. The continent saw a significant decline in investor activity, down 50% in 2023 compared to the previous year, Partech reported report, This retreat, influenced by global economic changes and local challenges, has reduced venture capital flows to African startups, which overall $2.9 billion and $4.1 billion last yearDecrease from $4.6 billion to $6.5 billion in 2022.
According to Partech’s findings, its impact was felt across all stages of investment, with seed stage deals down 33% and growth stage deals down 39%. While Partech Africa, which is known for leading rounds, cannot single-handedly reverse this trend, its focus on seed to series rounds may provide some stability and support for startups dealing with these challenging times.
Partech Africa seeks to support founders at different stages of their journey, from early stage to late stage, leveraging their position in the ecosystem, the firm’s general partners explained. “The ability to anchor rounds at all stages from seed to early development is more important than ever,” cyril cologne Said in a statement.
Meanwhile, in an email to TechCrunch, Tidjane Dame says the VC firm’s expanded team will enable it to effectively deploy capital and provide support to portfolio companies in these stages. With offices in Dakar, Nairobi and Dubai, Partech Africa has recently established a presence in Lagos, where it is actively hiring to engage closely with startups in the region, underscoring the importance of the city. does because one-third of the firm’s portfolio companies are located there. However, he clarified that the company will deploy the majority of its second fund between the Series A and B rounds.
Among its other fund investments is Revio, a South African payments orchestration platform, where Partech Africa co-led the seed round with global fintech fund QED. Additionally, the company has made undisclosed investments in Egyptian proptech and Senegalese e-commerce startups. Partech Africa intends to support more than 20 companies, with initial investments ranging from $1 million to $15 million, it revealed.
Dakar-based venture capital firm that has backed 17 startups first fund, prioritises sectors such as fintech, agritech, health tech, retail, FMCG and agency banking, which are critical to Africa’s employment and economic activity. Notable investments include Wave, TradeDepot, Yoko and Reliance.
Dame commented on the firm’s deployment strategy, “Companies from the first fund can benefit from follow-on capital from the first fund, but not from the second.” “We continue to support Fund 1 companies throughout their journey with capital and in many other ways.”
More of the fund’s strategies were covered during stop first Last February.
Partech Africa’s investor base reflects a diverse profile. During its first closing, development finance institutions, commercial investors, African funds-of-funds and family offices were some of its limited partners. For its second closing, it attracted participation from US and Middle Eastern pension funds, sovereign funds, Dubai Future District Fund (DFDF), and African Reinsurance Corporation (Africa Re).
Colon commented, “We are grateful for the support and commitment of our investors: nearly all Fund I investors reinvested, and some more than doubled their commitment.” “We are also honored to have backing from a new group of strategic investors from the US, the Middle East and Africa, and for some of them, this marks their first commitment in African tech.”
Partech’s African Fund also includes Several notable funds That’s despite challenges for fund managers raising capital, which have emerged on the continent in the past year as limited partners scrutinize strategies and track records. Other sizable funds include Norscan22, Al Mada and Novastar’s Africa People + Planet. Additionally, firms such as Enza Capital, Equator, Knife Capital and E3 Low Carbon Economy Fund for Africa (E3LCEF) have also closed large-scale funds, reflecting investors’ continued interest in Africa’s growth potential.
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