Paris-based VC agency Breega has noticed Africa’s tech ecosystem mature through the years. From receiving lower than a billion {dollars} in enterprise capital per yr to a record-high $6 billion, there’s additionally been a rise in high-growth corporations, from one unicorn to seven throughout the span of three years.
Now the VC needs to place a few of its personal cash behind what it sees, with a $75 million fund to put money into early-stage startups in Africa. It’s secured commitments for round 70% of the capital within the first shut, the agency revealed to TechCrunch.
Since getting into the VC scene in 2015, Breega has totally raised 4 funds: a primary seed fund (€45 million), a second seed fund (€110 million), a primary enterprise fund (€106 million), and a second enterprise fund (€250 million). In underneath a decade, the French investor, with a portfolio of over 100 startups throughout 15 international locations, has reached $700 million in belongings underneath administration.
The “Africa Seed I” fund is Breega’s sixth fund (together with a 3rd European seed fund the agency is at present elevating) in 9 years however the first with a mandate outdoors Europe. Its launch coincides with opening two new workplaces in Lagos and Cape Town, key hubs in Africa’s tech ecosystem. These workplaces be a part of Breega’s present places in Paris, London, and Barcelona, strengthening its presence throughout the EMEA area.
Breega prides itself on being a founders-for-founders fund, investing throughout pre-seed to Series A levels. “Our DNA is all about backing founders where innovation thrives and opportunities are immense. We bring them our operational expertise because everyone on our team has been on the other side as founders or operators,” mentioned co-founder and CEO Ben Marrel in an interview with TechCrunch.
Marrel notes that this strategy, coupled with a devoted scaling and portfolio assist group, has propelled Breega to turn into one of many fastest-growing VCs in Europe. The intention is to copy this success in Africa.
As such, launching a fund for early-stage startups stemmed from a want to faucet into the continent’s alternatives. What higher manner to do this than having native companions who perceive the market dynamics and might make knowledgeable funding choices? Larger Africa-focused companies with European roots, reminiscent of Partech and Norrsken22, function an identical technique.
Melvyn Lubega and Tosin Faniro-Dada are main Breega’s Africa fund, which obtained backing from establishments together with Bpifrance and the Dutch entrepreneurial improvement financial institution, FMO. Both companions convey a long time of entrepreneurial and operational expertise to the desk; earlier than becoming a member of Breega, Lubega co-founded the edtech unicorn Go1, whereas Faniro-Dada was the CEO of Endeavor Nigeria.
Breega plans to speculate between $100,000 and $2 million in startups throughout the Big Four African markets—Nigeria, Egypt, South Africa, and Kenya—in addition to Francophone African markets, together with Morocco, Senegal, Ivory Coast, Cameroon, and the DRC. The Africa-focused VC agency has already backed 9 startups, together with Numida, Hohm Energy, Socium, Klasha, Kwara, Coachbit, and Sava, and goals to make no less than 40 investments from this primary fund.
In an interview with TechCrunch, the companions mentioned Breega’s curiosity in Africa, the agency’s funding methods, native market dynamics, and the potential of untapped markets on the continent. The interview has been edited for brevity.
TC: $75 million is a sizeable first fund in any market, extra so in Africa. If I perceive appropriately, the fund is for pre-seed and seed startups. But except for the cash, what worth does the agency present that founders could not discover at different companies?
Melvyn: All companions and funding group members at Breega are former founders and operators. We know firsthand what it’s like to boost capital, construct companies, face failures, and endure powerful instances. Reflecting on my expertise, I struggled to search out African buyers who had constructed…
