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VC firm addresses Africa's $400bn funding gap

Staff Writer
By Staff Writer, ITWeb
Johannesburg, 11 Sep 2024
The Africa Mezzanine Impact Fund seeks to invest growth capital in African technology companies.
The Africa Mezzanine Impact Fund seeks to invest growth capital in African technology companies.

Early-stage venture capital (VC) firm Launch Africa Ventures has introduced its Mezzanine Impact Fund, to assist tech start-ups and larger companies with growth capital.

The fund seeks to invest mezzanine growth capital in African technology companies that demonstrate strong environmental, social and governance principles, across multiple sectors, and deliver tangible returns.

It also has the objective to unlock merger, acquisition and market expansion opportunities for Africa’s most impactful and innovative businesses.

According to Investopedia, mezzanine funding is an alternative source of risk capital that fills a funding shortfall where banks lack an appetite to lend, and where shareholders either lack cash equity to contribute, or don’t wish to dilute their shareholdings.

According to a statement shared on LinkedIn, the company has appointed Anthony Moore as chairman of the Mezzanine Impact Fund.

Moore is founder and executive chairman of the Evrensel Group of companies, which focus on electrical and construction projects.

“With a storied career at Goldman Sachs and leadership roles globally, Anthony Moore is set to propel our vision forward,” says the company.

“At Launch Africa Ventures, we're on a mission to power the continent’s innovators by investing in the tech companies driving Africa's transformation.”

The firm was founded by Zachariah George and Janade Du Plessis in 2020.They have been pioneers of early-stage venture capital in Africa since 2014, bridging the funding gap for seed and pre-Series A start-ups across the continent.

Launch Africa says since 2020, it raised just over $36 million in its first fund, investing $31 million in 133 start-ups across 22 countries, with impressive returns.

The Mezzanine Impact Fund seeks to address Africa's $400 billion funding gap at the growth stage. The company says it wants to focus on financing growth that fosters job creation, promotes gender equality and drives sustainable development across the continent.

Beyond financial support, the VC firm says it is offering strategic guidance to enhance governance, optimise operations and diversify offerings.

“We aim to support founders by pioneering a more tailored financial solution suitable to the African entrepreneurial ecosystem, enabling growth and market opportunities for technology companies in Africa.”

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