TLDR:
- Partech Africa closes its second fund at $300 million, a year after reaching its first close.
- The fund is aimed at African startups across various sectors and includes investors from US, Middle East, and Africa.
Global VC Partech has closed its €280 million (over $300 million) Partech Africa II fund, aimed at African startups across various sectors. This development comes a year after the VC closed Partech Africa II, which raised $263 million in 2023 and is the largest fund dedicated to African startups.
Partech Africa II’s second close includes US and Middle Eastern pension funds, sovereign funds, the Dubai Future District Fund (DFDF), and the African Reinsurance Corporation (Africa Re). Partech, which focuses on investing in digital and tech companies in various stages of growth, is headquartered in Paris and has since expanded to Dakar, Nairobi, Dubai, Berlin, and, most recently, Lagos. Partech Africa helps African startups grow from seed to early stage. The emphasis on early rounds is also likely to benefit struggling startups.
Partech Africa II is one of the VC’s three funds launched in the last two years, following Partech Africa I, which closed in 2018 for $143 million. The VC says its portfolio benefits over 1 million merchants and 20 million end users in Africa. Partech Africa II’s first close included participation from limited partners such as the German Development Bank, anchor investor KfW, and the International Finance Corporation (IFC).
In an interview, Partech’s general partner, Tidjane Deme, stated that the venture capital firm would primarily use the second fund for Series A and B rounds. Moreover, another report said the VC will use the funds for Series C rounds, with funding ranging from $1 million to $15 million. Deme also said that “the VC firm’s expanding team will enable it to effectively deploy capital and offer assistance to portfolio companies across [various stages of their journey].” Additionally, Deme states that “companies from the first fund can benefit from follow-on capital from the first fund but not from the second one.”
Partech African I invested in 17 Series A and B startups from nine countries as part of its plan to make 20–25 investments across roughly ten countries. TradeDepot, Wave, Yoco, Reliance, and Nomba are among the startups operating in the fintech, retail and FMCG, agency banking, and health tech sectors.
According to a Partech survey, Africa’s investor activity will drop by 50% in 2023 due to global economic and local challenges. It decreased from $4.6 billion to $6.5 billion in 2022 to $2.9 billion and $4.1 billion. However, Partech’s significant fund closure could signal a comeback in 2024, strengthening Africa’s startup industry.
