Good news for African startups looking to close Series B rounds of funding. Knife Capital, a venture capital company based in Cape Town, South Africa has announced that it is nearing the signing of a major Limited Partner for its third fund, which aims to raise $50 million to invest in South African technology startups. The latest addition to the company’s International Fund III is the International Finance Corporation (IFC) — the World Bank’s private-sector investment arm — which will invest up to $10 million in the fund.
Here Is What You Need To Know
- The fund will assist Knife Capital in investing in technology companies with strong intellectual property and potential for pan-African and global expansion in sectors including platform businesses, applications, tech-enabled business services and fintech.
- With the fund, the company is targeting Series B rounds of funding primarily in South Africa 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.
- A US dollar-denominated limited partnership in Jersey and a South African rand-denominated limited partnership in South Africa make up the fund’s major funding vehicles. Both vehicles will invest in portfolio companies together.
- Keet van Zyl, Andrea Bohmert, Eben van Heerden, Bob Skinstad, and Davey Gant will oversee the new fund.
- IFC’s pledge comes only two months after Mineworkers Investment Company (MIC) made a $10 million commitment to Knife Fund III, establishing MIC as an anchor LP alongside other local and foreign investors.
- MIC is a holding firm for investments. The Mineworkers Investment Trust formed it to provide funding for the Trust’s social and educational projects. It makes investments in a variety of industries, including financial services, wellness, recreation, business services, industrials, and media.
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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.
Knife Capital is headquartered in Cape Town, with offices in London and Jersey.
Mark Shuttleworth’s HBD Venture Capital Fund was previously run to a profitable exit and closure.
In 2010, the company raised its first investment.
It also launched its Grindstone Accelerator program three years later to cultivate a pool of technology-enabled small and medium-sized businesses.
The company followed up with a second fund in 2016.
It, again, launched the Draper-Gain Family Office as a strategic investor a year later, and expanded to the UK to help portfolio companies develop internationally.
The company launched an extension fund to its second fund last year. This year, it opened its third venture capital fund.
Knife Capital Series B startups Knife Capital Series B startups
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