Africa is poised to become the next major hub for tech startups and innovation. Norrsken22, an Africa-focused venture capital firm, recently announced it has raised $205 million (Ksh 30,996,000,000 approx) to invest in the next generation of African “tech giants” in sectors like fintech, edtech, and medtech.
The fund secured backing from over 30 unicorn founders and top institutions including Skype’s Niklas Zennström, Delivery Hero’s Niklas Östberg, Flutterwave‘s Olugbenga Agboola, Standard Bank Group, Norfund, British International Investment, the International Finance Corporation, and the US International Development Finance Corporation.
With the new capital, Norrsken22 plans to make around 20 investments focused on startups in South Africa, Nigeria, Ghana, Kenya, and Egypt. The fund has already invested in five companies so far, including leading South African digital bank TymeBank.
“We would like to build out a portfolio of about 20 investments in the beacon economies of Africa,” said Norrsken22 Managing Partner Natalie Kolbe in an interview.
Ripe Conditions for Tech Growth
Africa has the fastest growing and youngest population worldwide. An increasing number of tech-savvy youth are turning to their mobile devices for services ranging from entertainment to banking.
Norrsken22 seeks to capitalize on the expected boom in African tech fueled by investments in digital infrastructure and rising smartphone adoption. Urbanization and growing demand for financial services, healthcare, and education also present huge opportunities for startups to scale, notes Kolbe.
The Norrsken22 fundraise comes amid a slowdown in startup funding across Africa and globally this year. Africa attracted around $2.5 billion in VC funding during the first half of 2023, per Briter Bridges. But new funds like Partech’s recent $260+ million raise signal continued interest in African startup investment.
With its impressive investor backing and localized market focus, Norrsken22 is strategically positioned to unearth Africa’s next wave of breakthrough startups. The fund’s fintech and digital health bets in particular could empower underserved populations with vital financial and medical access.