Knife Capital, a Cape Town-based venture capital firm, has recently achieved a significant milestone by successfully closing a $50 million fund with a strong focus on pan-African investments. This news comes alongside the announcement of Knife Capital’s successful investment in the East African region, further highlighting the company’s commitment to driving innovation and growth throughout the continent.
The newly established fund, known as Knife Capital (International) Fund III LP, or “Knife III,” has set its sights on supporting and investing in high-growth technology companies primarily in South Africa. Specifically targeting the scale-up or expansion stage (Series B), Knife III seeks out innovative companies with robust intellectual property and tremendous potential for both pan-African and global expansion. The fund has identified sectors such as Platform Businesses, Software, Tech-enabled business services, and FinTech as key areas of interest for investment.
One notable achievement for Knife Capital with the Knife III Fund is the backing it has received from the International Finance Corporation (IFC), a renowned development finance institution. The IFC invested $10 million in Knife Fund III, with the objective of fostering the growth of South Africa’s digital economy and enhancing access to financing for technology entrepreneurs in the country. The IFC recognizes that by increasing access to venture capital, it can help nurture digital entrepreneurship and facilitate the provision of vital services such as healthcare, fintech, and logistics. Adamou Labara, the IFC South Africa country manager, emphasized the significance of supporting funds like Knife III to empower startups and digital entrepreneurs in South Africa and beyond.
In addition to the IFC’s support, Knife Fund III also has garnered backing from other investors, including Standard Bank and the SA SME Fund. The fund equally received commitments exceeding $40 million from a diverse range of local and international investors, such as the Mineworkers Investment Company, international development funders, and prominent family offices. This strong investor support positions Knife Fund III for continued success.
Standard Bank Corporate and Investment Banking, recognizing the positive impact of early-stage, high-growth investments on innovation, job creation, and economic development in South Africa, expressed its belief in Knife Capital’s mission. Akash Maharaj, an executive in equity finance and investments at Standard Bank, highlights the bank’s commitment to partnering with leading investors in the venture capital space and its excitement to include Knife Capital in its portfolio. With Standard Bank’s extensive African presence, tailored banking products, and broad client base, the bank is well-positioned to facilitate the growth journey of businesses aiming to scale internationally.
The SA SME Fund, known for nurturing South Africa’s entrepreneurial spirit through long-term partnerships, is also delighted to continue supporting Knife Capital’s initiatives by participating in Fund III. The fund’s CEO, Ketso Gordhan, acknowledged the importance of sustained support for Knife Capital and its contribution to driving innovation and growth in South Africa.
read also United Kingdom Visa Payment Changes for Applications in Morocco
The Knife Fund III has a clear focus on scalable business-to-business technology companies that demonstrate attractive exit potential. The fund operates through two main funding vehicles: a USD-denominated limited partnership in Jersey and a ZAR-denominated limited partnership in South Africa. Both entities work in collaboration, co-investing in portfolio companies to maximize their impact.
Already making its mark, Knife Fund III has made its inaugural investment by leading a $10 million funding round in DataProphet, a South African startup specializing in AI-as-a-service software for the manufacturing sector, and has already followed it up with another investment in East Africa. Keet van Zyl, co-founder at Knife Capital, expressed great enthusiasm for the partnership with Standard Bank, highlighting the value it brings not only as a funder but also as a growth partner for their portfolio companies.
Knife Capital African Fund Knife Capital African Fund
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