Oui Capital, an Africa-focused venture capital firm based in Lagos and Massachusetts, announced today the completion of the first close of its $30 million second fund, Oui Capital Mentors Fund II, as part of its efforts to strengthen its footprint on the continent.
Angur Nagpal’s Vibe Capital, D Global Ventures, Boston-based One Way Ventures, and Ground Squirrel Ventures are among the global VCs involved in this second round.
As limited partners in Oui Capital’s second fund, a mix of individual and VC investors were welcomed. Individual investors included Foundry Group partners Brad Feld, Seth Levine, and Ryan McIntyre, Gbenga Oyebode, Alitheia Capital’s Tokunboh Ismael, Idris Alubankudi, and TeamApt CEO Tosin Eniolorunda.
Here’s What You Need To Know
- The second $30 million fund, like the first, will support Sub-Saharan African firms in the pre-seed and seed phases. So far, the firm has completed its first close at somewhat more than $11 million, with the full close expected to be completed by Q4 2022.
- Oui Capital’s inaugural fund, according to managing partner Oyinsan, generated early solid returns, with a MOIC (multiple on invested capital) in excess of 7 times. He stated that one of the reasons the firm was able to accomplish this is due to the “sparks” that determine which startup to invest in or not: team, market, customer and tech understanding, and customer satisfaction.
- According to Oyinsan, the firm would seek to cover the entire range of investments up to Series A, including bridge rounds, an activity that will be accelerated, especially given the present venture capital shortage. In related developments, another venture capital firm, Zedcrest Capital, announced a $10 million ‘emergency fund’ last week to help entrepreneurs in the pre-Series A stage.
- Oui Capital wants to write first checks of up to $750,000 from this new fund (a tenfold increase from the ticket size of its original fund), with reserves set aside for such follow-on investments.
- In terms of follow-on capital, Oui Capital’s managing partner stated that such investments are made proactively as part of the firm’s continuing portfolio monitoring. Currently, Oui Capital has made follow-on investments in around 20% of its portfolio companies.
“We go the extra mile with founders whom we partner with and this is why we maintain a relatively smaller portfolio compared to many seed funds. However, there is a critical distinction between the responsibilities of a VC as an investor and as a fund manager,” said the managing partner. “Being an investor begets the type of die-hard optimism and support as earlier described. Being an effective fund manager also puts the fiduciary responsibility on you to know when to stop devoting scarce resources to problems that might prove too difficult to fix and dedicate these resources to higher-performing companies in your portfolio to minimize losses and maximize investor value.”
A Look At What Oui Capital Does
The firm, founded in 2019 by Olu Oyinsan and Francesco Andreoli, raised $10 million for its first fund. Since then, Oui Capital has made 18 investments in several technological sectors, including fintech, logistics and mobility, e-commerce, healthcare, and enterprise software. TeamApt, MVX, Akiba Digital, Duplo, Ndovu, Maad, Intelligra, Aifluence, and Pharmacy Marts are a few examples.
Read also :Seedstars Capital Launches $20M Fund To Invest In African Startups
Oui Capital made eight investments last year, and its second fund indicates that the VC intends to keep up the pace.
“Expect us to be leading many more deals across the ecosystem and vocalizing firm initiatives — all things that we’ve been doing quietly in the past four years, but now looking to double down on these with the new fund,” Oyinsan added.
Oui Capital has made at least one investment in the African countries of Nigeria, Kenya, Senegal, Egypt, and South Africa. The firm intends to increase its investments in North Africa and Francophone Africa, two regions that saw increased startup and venture capital activity last year, when African tech funding reached record highs in correlation with worldwide data.
“Our pan-African strategy has made us a fund of choice for global LPs looking for exposure to the broader Africa opportunity without having to get into the weeds of understanding different regions separately,” stated Oyinsan.
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Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh