Seedstars Africa Ventures, the pan-African early-stage fund for startups, has appointed Bruce Nsereko-Lule as its new general partner, to help it deploy more capital and provide the much-needed technical support for founders across the continent.
Seedstars Africa Ventures -- which is part of Seedstars Group, an accelerator and VC that is active globally in more than 30 emerging markets -- provides early-stage capital of up to $2 million in seed and Series A rounds. The fund counts the French equity firm LBO France among its limited partners, and has, so far, invested over $5 million in five startups, including Kenya's ISP Poa Internet and Nigeria's grid management SaaS for electricity distribution utilities Beacon Power Services, since it was founded in 2020.
The fund, which plans to deploy more capital over the next few months, will tap Nsereko-Lule’s vast experience, and the networks he has gained over the years as an active venture capitalist in Africa.
Nsereko-Lule told TechCrunch that his focus at the fund will be helping it make great investments in the continent and provide initial and follow-on funding to cushion startups, and help them build and scale businesses.
“We will be putting in an initial check and basically, we will lead the round. And then we will keep funding until the business has reached proper growth, and probably hit profitability and has opportunities to exit and further scale,” said Nsereko-Lule, who has joined Tamim El Zein and Maxime Bouan, the fund’s other general partners.
By doing this, we are providing more funding to local founders, and trying to stop this constant fundraising loop that founders find themselves in. The support is meant to help them to spend their full time building the business.
Seedstars Africa Ventures general partners (L-R) Tamim El Zein, Bruce Nsereko-Lule and Maxime Bouan. Image Credits: Seedstars Africa Ventures
Prior to joining the fund, Nsereko-Lule was previously the founding investment principal of Chandaria Capital, a Kenya-based VC fund founded in 2017 to serve as the investment vehicle of the Chandaria Industries. He had previously worked as an investment banker in the U.K.
Chandaria Capital backed 38 startups
During his time at Chandaria Capital, Nsereko-Lule says they invested millions of dollars in 38 startups, initially starting with Kenya before entering other African and emerging markets in South America and Asia.
By the end of his tenure, the sector-agnostic fund had completed 52 transactions (including follow-on investments) with startups such as Tushop, Jumba, Wasoko, Kobo360, TradeDepot, Carry1st, Shara and Chari.
“I was in charge of operations, and it was an exciting journey -- it was something completely new, but I had my financial background. We decided to be a sector-agnostic fund from day one, and that was because we saw multiple investment opportunities across the continent,” he said.
At Seedstars Africa Ventures, Nsereko-Lule plans to continue backing founders in the continent at even a greater scale, as he is convinced that there are many great startups in Africa that are struggling to get funding.
“Venture capital in Africa is doing very well. You see multiple businesses gaining funding, building sustainable business models, growing and scaling. An interesting fact is that the startups that we invested in have managed to raise over $450 million since our investment. So, this really proves that Africa has managed to create an environment where companies can grow and successfully scale to valuable businesses,” said Nsereko-Lule.
He added: “We're also in a fortunate situation where we have a much higher success ratio. With startups really managing to scale and gain more funding. And we're starting to see the development of exits.”
Seedstars Africa Ventures fund targets to raise $100 million to invest in startups within Africa -- which continue to receive the least VC funding when compared to other regions in the World. Last year, the continent received nearly $5 billion in VC funding, and while this was almost double the previous year, the funding was negligible in comparison with markets like the U.S. ($311-$329.8 billion), and India ($42 billion).
However, Nsereko-Lule says the ecosystem will continue to grow.
“There are a lot of opportunities to invest in, provide good returns, and at the same time make an impact on the continent.”