EU invests $30m in African digital technology aid fund

10th January 2024

By: Marleny Arnoldi

Deputy Editor Online


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Luxembourg-headquartered lending institution of the European Union (EU), European Investment Bank (EIB) Global has announced a $30-million equity investment in Seedstars Africa Ventures’ Fund I, which will allow more African digital technology companies to grow.

Seedstars Africa Ventures' venture capital fund focuses on growing companies, creating skilled jobs and improving products and services, particularly those addressing basic needs of education, healthcare and utilities.

For EIB, encouraging and promoting innovation and digitalisation is crucial to developing strong and sustainable economies, says VP Ambroise Fayolle. He believes African entrepreneurs hold the key to the continent’s future, including reducing inequality and improving quality of life.

The $30-million EIB Global investment is backed by the EU through $20-million from the ACP Trust Fund and $10-million from the Boost Africa programme.

Seedstars Africa Ventures is part of global organisation Seedstars, in partnership with investment platform LBO France, that invests and supports entrepreneurs in emerging markets. It is targeting to have an investment portfolio of between $80-million and $100-million.

European Commission VP Margaritis Schinas says the digital sector is a driver of growth and innovation and that small and medium-sized enterprises, together with startups, are fuelling the digital economy.

“Kenyan and African digital economies have tremendous potential and helping entrepreneurs access finance can be a game changer to foster quality growth and jobs, a common priority for both the EU and its African partners,” he adds.

Venture capital investments reached $4.8-billion in Africa in 2022, marking a 270% increase from the $1.3-billion invested in 2019. However, despite this tremendous growth, a significant equity gap continues to exist at the early stages of funding on the continent, which calls for more investment in this space.

Seedstars Africa Ventures invests in Seed+ and Series A rounds, with an ability to follow on significantly, effectively bridging the pools of capital available.

The venture capital fund leads investment rounds to facilitate syndication and provides strong operational support that is critically lacking in the regional venture capital space.

On top of its internal, on-the-ground teams, the fund uniquely leverages support resources provided by the acceleration platform of Seedstars.


Seedstars Africa Ventures expects to reach a first close early this year but has already completed four transactions, including in Beacon Power Services (BPS), Poa! Internet, Shamba Pride and Bizao.

Each company is building an innovative solution to tackle some of the continent’s most pressing needs.

For example, Lagos-based BPS has developed proprietary grid management software and data solutions for Africa’s power industry.

BPS seeks to improve the reliability and quality of the continent’s energy supply through the creation of smart grids, by leveraging extensive data collected on the ground.

As of September last year, BPS has been working with four utility companies in Nigeria and Ghana connecting to a population of more than 60-million and has reduced grid energy losses by an average of 25% per utility.

In Lagos, this translated into three additional hours of energy daily per household. Better access to grid electricity also allows the homes and businesses connected to BPS’ clients to rely less on diesel generators, which the company estimates saved 1.7-million tons of carbon dioxide in 2023.

Global pressures in the last 18 months have made it more difficult for companies to access finance, in particular at the earliest stages of developing the business.

This has limited the expansion of innovative technology companies. Fostering private sector development and the digital economy will contribute to inclusive economic growth, reducing economic and social disparities.

Digitalisation is a key part of the economic and social development of many African countries. It is also a core pillar of the EU’s Global Gateway strategy.

Global Gateway is the European strategy to boost smart, clean and secure links in digital, energy and transport sectors, and to strengthen health, education and research systems across the world.

Edited by Creamer Media Reporter




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