Startups in Africa looking for Series B funding now have additional fund to pitch. Black-owned investment company the Mineworkers Investment Company (MIC) has committed $10-million to venture capital firm Knife Capital’s new African Series B expansion fund − Knife Fund III.
“The move to change the way local institutional investors approach venture capital investment has been in the pipeline at MIC for a number of years now. Our venturing into the earlier-stage alternative asset class space makes sense given the slow economic growth in the last three years.
“Our commitment brings to the table the investment, along with many of our strengths as an experienced player. One of which is our ability to influence the companies within our portfolio to partner with us and effect real, tangible change to the South African economy. We are delighted to be a key catalyst in the success of this funding round,” MIC CIO Nchaupe Khaole said.
Here Is What You Need To Know
- The fund will assist Knife Capital in investing in the aggressive expansion of African innovation-driven companies as well as fill critical funding gaps.
- The company is targeting Series B rounds of funding because, according to it, there is a looming funding crunch for the crop of startups that manage to get over the Series A funding hump and then require significant risk funding for aggressive growth and scaling.
“Successful entrepreneurs on the continent with world-beating innovations are simply under-funded to compete on the global stage. Therefore, while investments and investors are increasing globally, measured in terms of innovation potential, Africa remains under-capitalised,” the company explains.
- MIC further notes that the latest commitment will position it as an anchor investor of the fund, alongside other local and international investors.
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A Look At The Venture Capital Firm Knife Capital
Knife Capital operates KNF Ventures I and II’s Section 12J venture capital assets, as well as selected family office portfolios. The aim of Knife Fund III is to raise $50 million to be well placed to directly invest in South African breakout companies’ ambitious expansion and co-invest in companies across the rest of Africa with other reputable funders. Scalable business-to-business technology companies with lucrative exit opportunities would be the target.
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Knife Capital is now rolling out Knife Fund III to resolve the crucial funding gap in Series B that has defined South Africa’s venture capital asset class, contributing to companies not achieving their full potential or exiting too early. The fund consists of two primary financing vehicles: Jersey’s dollar-denominated limited partnership and South Africa’s rand-denominated limited partnership, which will co-invest in portfolio companies alongside each other.
The MIC invests investing in the rand-denominated relationship.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer
Knife Capital Series B African startups Knife Capital Series B African startups