The capital-investor has finalized the raising of its first fund, dedicated to African start-ups. In parallel, it opens in Nairobi its second office on the continent, after that of Dakar.
Partech Africa announced Thursday, January 31, the “final closing” of its first investment vehicle dedicated to start-ups in the technology sector in Africa. The fund raised 125 million euros, 25% more than the initial target of 100 million euros. However, the fundraising was completed with a slight delay compared to the end of 2018, announced a year ago.
Partech Africa is led by Tidjane Deme, former director of Google in French-speaking Africa, and Cyril Collon, former vice president of sales for Europe and Africa of Verscom Solutions, a telecommunications services provider. It is a structure of Partech Ventures, a technology investor, which has closed nearly 70 equity investments and raised more than one billion euros between 2016 and 2017.
The fund intends to bet between 500,000 euros and 5 million euros in start-ups with a pan-African ambition “in the fields of fintech, health, education, trade, mobility …”, explained a year ago its founders, interviewed by Jeune Afrique.
IFC, AfDB, L’Oréal or Orange Digital Ventures among investors
The Partech Africa model seems to have convinced a wide variety of donors. Among the investors in its first vehicle are public institutions such as the African Development Bank (€ 7 million), the European Investment Bank (€ 10 million) and the International Finance Corporation (IFC, a subsidiary of the group). from the World Bank, € 15 million). The message also appealed to private actors, such as the German media giant Bertelsmann (RTL Group, Penguin Random House …), the Malagasy group Axian, owned by the Hiridjee family, and the French L’Oreal. “Partech Africa has received the support of more than 40 investors with complementary and international profiles”, says the private equity investor.
It is now up to the teams of Partech to realize their African ambition. The environment of start-ups on the continent is generating a lot of enthusiasm, with “$ 560 million raised by more than 120 African start-ups in the new technologies sector”, advancing early in 2018, the promoters of Partech. But many actors complain about the excessive demands of founders and leaders of start-ups in Africa.
A French investor recently interviewed by Jeune Afrique estimated that the valuation levels of several young shoots of the continent were not significantly lower than those of their Western counterparts, despite significant differences in terms of risks as well as in the economic and regulatory environment. . In addition, competition is already tough on this niche, be it Partech Africa, Britain’s TLCom or French Orange Digital Ventures. The latter is also an investor in the new Partech Africa fund.
First equity investments
“The venture capital market in Africa undoubtedly shows promising signs of growth; It remains to be seen how long the ecosystem will grow enough to locally support a significant creation of businesses and jobs, “warned, in early 2018, Michelle Ashworth, a venture capital consultant to the British CDC Group. “It is likely that the African market will take at least fifteen years to reach full maturity,” added the consultant.
Partech executives remain optimistic. Their new fund has already announced two investments, in Nigerian Trade Depot (logistics) and South African Yoco (digital payment). According to information from Jeune Afrique, a third equity investment has already been completed but not disclosed and a fourth is currently being negotiated. “Our early investments in Yoco and TradeDepot are remarkable examples of how these champions can transform entire sectors such as retail and payment in this region,” said Cyril Collon, partner of Partech, in a statement.