Olugbenga Agboola and team support Norrsken22’s $205M tech fund

Norrsken22, the Africa-focused venture capital firm, has successfully secured $205 million in funding for its tech investment endeavors on the continent. What makes this achievement particularly remarkable is the extensive support it received from more than 30 unicorn founders and a variety of influential institutions. These key backers include renowned names such as Olugbenga Agboola of Flutterwave, Niklas Zennström, the co-founder of Skype, and Niklas Östberg, the founder of Delivery Hero.

In addition to these unicorn founders, other notable investors contributing to Norrsken22’s fund include Standard Bank Group Ltd., Norfund, British International Investment, the International Finance Corporation, and the US International Development Finance Corporation. With such robust backing, Norrsken22 is primed to make a significant impact on Africa’s burgeoning tech landscape.

The fund’s strategic objectives center around identifying and supporting the next generation of tech giants in Africa, with a particular emphasis on sectors such as fintech, edtech, and meditech. This approach aligns with the broader global trend of accelerating digital transformation in key industries. The fund is poised to stimulate innovation and entrepreneurship, driving growth and progress across the continent.

Natalie Kolbe, the Managing Partner of Norrsken22, underscored the fund’s regional focus by highlighting its intention to primarily invest in startups based in South Africa, Nigeria, Ghana, Kenya, and Egypt. To date, the fund has already made five investments, including a substantial commitment to Tyme Bank in South Africa. Kolbe has ambitious plans for the fund’s portfolio, aiming to expand it to around twenty investments within the beacon economies of Africa.

One of the driving forces behind this investment strategy is the promising trajectory of the African tech ecosystem. The region is experiencing remarkable growth, propelled by significant investments in digital infrastructure and widespread smartphone adoption. This surge in technological development is further fueled by urbanization and the increasing demand for financial and healthcare services. These trends present an opportunity for tech startups to flourish, scale their operations, and make a meaningful impact on the continent.

While the African tech landscape is teeming with potential, the availability of funding has been a key concern. The global economic slowdown has affected funding for startups in Africa, mirroring the broader economic climate. In the first half of the year, the continent attracted approximately $2.5 billion in investment, a reflection of the challenges that African startups face. However, this setback has not deterred committed organizations like Norrsken22.

Partech, another central capital fund, has raised over $260 million to invest in African startups, signaling the continued appetite for investment opportunities on the continent. Despite the challenges, there is still a strong belief in the potential of African tech businesses.

A report by the African Private Capital Association (AVCA) revealed that venture capital deals in Africa decreased by 36% in Q3 2023 compared to the same period in the previous year. This reduction in activity is partially due to fund managers becoming more cautious and reducing their participation in seed and early-stage investments during this period.

The report also highlighted a 16% drop in the total deal value generated by African-focused fund managers in the third quarter of 2023 compared to the same period in the previous year. This decline in deal value extended across deals of all sizes, including those below and above $100 million. The report underscores the need for increased investment and support for the African tech ecosystem, especially during challenging economic times.

The investment landscape in Africa is undoubtedly facing challenges, but the commitment of organizations like Norrsken22, supported by unicorn founders and key institutions, signals a strong belief in the potential for growth and innovation in the African tech sector. As the continent continues to advance its digital infrastructure and expand access to technology, there are ample opportunities for startups to thrive and make a lasting impact on the region’s economy.

In conclusion, Norrsken22’s successful fundraising effort and its dedication to investing in Africa’s tech future are encouraging signs for the continent’s entrepreneurial and innovative spirit. As global investors and institutions recognize the immense potential in African startups, the future holds promise for the growth and development of the African tech ecosystem.