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African startups backed by Digital Africa set to receive $79m

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Digital Africa, a French government-backed organisation assisting African tech startups has announced that it will provide 70 million euros ($79 million) for seed and Series A funding by 2025.

In a press conference, Stephan Eloise-Gras, the initiative’s executive director said Digital Africa aims to fund 200 African startups with seed funding of between 20,000 euros and 200,000 euros each.

The initiative, launched by French President Emmanuel Macron in 2018 started as a nonprofit organisation with a mission to equip Africa’s tech entrepreneurs with the capabilities to design and scale-up groundbreaking innovations for the real economy.

Backed with 130 million euros from Proparco, a unit of the Agence Francaise de Developpement, (French Development Agency), Digital Africa has pivoted from the nonprofit model.

“To bring these changes to life, Digital Africa, is looking to move away from its initial nonprofit model, with the ambition to get closer to the African and global private sector by focusing on early stage startups,” it said in its White Paper 2022, released on Tuesday.

About Digital Africa

Digital Africa brings together a multinational community of partners who support Africa’s digital entrepreneurs – incubators, financial institutions, venture capitalists and tech clusters.

The French Development Agency (AFD) was the driving force behind the creation of Digital Africa and continues to be a major partner.

The initiative has programs focused on supporting high-impact digital startups, fundraising and sourcing finance to scale-up Africa’s tech innovations and advocating policies that will drive digital entrepreneurship across Africa.

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Digital Africa set up the 5 million euro Bridge Fund with Proparco in 2020 and has so far disbursed seed funding of between 175,000 euros to 600,000 euros to 10 companies. A record $5 billion in startup capital was raised in Africa last year.

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With the new model in place, the initiative plans to shift its focus beyond the three key nodes of South Africa, Nigeria and Kenya, which together account for almost four fifths of the money raised by African startups.

It will also look to provide funding to hubs in countries ranging from Ivory Coast to Tunisia, according to the announcement.

In recent times, the entrepreneurial and tech space in Africa has seen impressive input of funds, ranging from the Women Entrepreneurship for Africa initiative, that seeks to empower women and the Visa Everywhere Initiative.

Overall, strong year-on-year growth at every check size underlines the perception in Africa that more investors are keen to get into the startup arena whether at early or growth stages.

Source:technext.ng | Oluwadara Idowu Kuola

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