This is not the first time Swiss venture capital firm, Crypto Valley Venture Capital (CV VC), would be investing in an African blockchain startup. In 2019, the VC invested $75,000 in South Africa’s PocketJam for a 10% stake. However, the VC’s investments have always been made after blockchain startups have passed through its Labs Incubation Programme located in Zug, Switzerland. But now, the venture capital firm wants to launch its African operations in Cape Town, South Africa to focus exclusively on African blockchain/crypto startups.
The CV VC office in South Africa would be established with the help of the Swiss State Secretariat for Economic Affairs (Seco). CV VC will use the office to search for and fund the top blockchain startups in South Africa, Nigeria, Kenya, Rwanda, Congo, and other African countries. Each of the first five successful candidates will get $125,000 (CHF114,000) from the incubator, with Seco investing CHF250,000 in the first year of the project.
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“This start-up funding is intended to show that investments in African start-ups that develop blockchain-based solutions for the challenges on the African continent are worthwhile,” says Seco. “This positive demonstration could mobilise further private capital and generate jobs.”
Previously, CV VC had opened an office in Dubai where and has recently attracted CHF13 million in extra investment capital.
CV VC’s Interest In Africa Is Partly Backed By The Swiss Government
Switzerland’s foreign policy prioritizes Sub-Saharan Africa. That strategy will heavily rely on external links and digitalization. To that end, Switzerland’s “Crypto Nation” is supporting a public-private cooperation aimed at developing blockchain solutions to some of the continent’s problems.
In addition to the incubation initiative, the Swiss embassy and the University of Zurich are partnering to establish a blockchain chair at the University of Johannesburg, which will be partially funded by both Switzerland and South Africa.
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The collaboration exemplifies how Switzerland, the self-proclaimed “Crypto Nation,” can expand its impact around the globe. Approximately 5,000 jobs are supported by nearly 1,000 blockchain startups in Switzerland. The upgrade of company and financial laws to integrate DLT and digital assets into the economy has boosted it this year.
“There are a lot of immigrants in South Africa from neighbouring countries who send money home to support their families. A lack of financial infrastructure does not make it easy to send these remittances,” CV VC South Africa hub managing director Gideon Greaves said.
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