Black Ostrich Ventures, a Los Angeles-based venture capital firm, has launched a $20 million pre-seed and seed stage fund to support African founders to grow their businesses in the cleantech, supply chain, ag-tech, and edtech sectors. The newly created firm will support startups with check sizes ranging from $50,000 to $200,000. The fund—backed by LPs in New York and undisclosed high-net-worth individuals in Los Angeles—will be focusing on startups in Tanzania, Zambia, Morocco, and Uganda.
The General Partner of Black Ostrich Ventures, Ajani Windsor-Areago explained that the decision stems from a belief that potential exits and deal activities in these countries are being overlooked. “If you look at the capital inflows into VC in Africa, the Big Four countries—Nigeria, South Africa, Egypt, and Kenya—attract all the capital. But most exits do not happen in these markets,” he said
According to Briter Bridges, fintech—which has been Africa’s top sector in terms of the number of deals and volume of funding since 2015—accounts for less than a third of exits on the continent. Data shows that markets like Tanzania and Zambia which are receiving way less funding compared to the “Big 4” still have viable exit pathways.
Black Ostrich Ventures said in the statement that it intends to concentrate its investments in venture-investable businesses and countries with promising exit opportunities. The firm hopes to leverage Windsor-Areago’s experience in the VC industry. Windsor-Areago worked as the Head of North America for Lagos-based Platform Capital and was recently a Venture Partner with Expert Dojo, a US-based early-stage fund. He currently serves on the advisory boards of eight startups worldwide, including Cpayant (UK), ESGentle (San Francisco), Hytribe (Uganda), and Wayli (Morocco).
In addition to the first checks, the firm will offer a follow-on investment of up to $1 million if the company reaches Series A. Windsor-Areago said that the support for African startups will go beyond funding. “We will be working with founders in a very unusual way. We’re going to surround founders with growth experts and marketing experts to help them grow their businesses. It’s one thing to be great at starting a company, understanding the marketing aspect of the business is another,” he said.
Source: Tech Cabal
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