Breaking down France’s new $76M Africa startup fund – TechCrunch
Weeks after French President Emmanuel Macron unveiled a $76 million African startup fund at VivaTech 2018, TechCrunch paid a go to to the French Improvement Company (AFD) — who will administer the brand new fund — to get extra particulars on how le noveau fonds will work.
The $76 million (or €65 million) will divvy up into three components, in line with AFD Digital Activity Staff Chief Christine Ha.
“There are €10 million [$11.7 million] for technical assistance to support the African ecosystem… €5 million will be available as interest-free loans to high-potential, pre-seed startups…and…€50 million [$58 million] will be for equity-based investments in series A to C startups,” defined Ha throughout a gathering in Paris.
The technical help will distribute within the type of grants to accelerators, hubs, incubators and coding packages. The pre-seed startup loans will situation in quantities as much as $100,000 “as early, early funding to allow entrepreneurs to prototype, launch and experiment,” stated Ha.
The $58 million in VC startup funding will likely be administered by means of Proparco, a improvement finance establishment — or DFI — partially owned by the AFD. The cash will come “from Proparco’s balance sheet”…and a portion “will be invested in VC funds active on the continent,” stated Ha.
Proparco already invests in Africa-focused funds equivalent to TLcom Capital and Partech Ventures. “Proparco will take equity stakes, and will be a limited partner when investing in VC funds,” stated Ha.
Startups from all African nations can apply for a chunk of the $58 million by contacting any of Proparco’s Africa places of work (together with in Casablanca, Abidjan, Douala, Lagos, Nairobi and Johannesburg).
And what is going to AFD (and Proparco) search for in African startup candidates? “We are targeting young and innovative companies able to solve problems in terms of job creation, access to financial services, energy, health, education and affordable goods and services…[and] able to scale up their venture on the continent,” stated Ha.
The $11.7 million technical help and $5.eight million mortgage parts of France’s new fund will likely be out there beginning in 2019. On implementation, AFD remains to be “reviewing several options…such as relying on local actors through [France’s] Digital Africa platform,” stated Ha.
Digital Africa — a broader French authorities initiative to help the African tech ecosystem — will launch a brand new on-line platform in November 2018 with sources for startup entrepreneurs.
In order that’s the thin on France’s new Africa fund. It provides to a load of VC introduced for the continent in lower than 15 months, together with $70 for Partech Ventures, TPG Progress’s $2 billion Rise Fund and $40 million at TLcom Capital.
Although $75 million (and these different quantities) could pale in comparison with Silicon Valley VC values, it’s loads for a startup scene that — at tough estimate — attracted solely $400 million 4 years in the past. African tech entrepreneurs, you now have much more international funding choices, together with from France.