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World Bank Supports South Africa’s Digital Entrepreneurs With $10m Investment

February 12, 2022

The International Financial Corporation (IFC) , a member of the World Bank group, has invested US$10 million in Knife Fund III, a new fund managed by Cape Town-based venture capital firm Knife Capital.

IFC is the largest global development institution focused on the private sector in emerging markets, while Knife Capital is a venture capital investment manager that accelerates the international expansion of African innovation-driven businesses by leveraging knowledge, networks, and funding.

Adamou Labara, IFC’s country manager for South Africa

Knife aims to raise US$50 million for Fund III, which will primarily target investments at the Series B stage. Fund III follows Knife Fund II, which was launched in 2016, and Fund I, which was launched in 2010. IFC’s US$10 million investment will provide financial support to tech startups in high-growth sectors in South Africa with strong potential for expansion across Africa and internationally, including enterprise technology, software, health-tech, and fintech.

“We are excited to welcome IFC as an investor to our new Fund III and sincerely appreciate the endorsement that comes with the commitment,” said Andrea Bohmert, partner at Knife Capital. “With the first close of Fund III, we are finally able to support entrepreneurs on the next stage of the scale-up journey and thereby address a significant gap that currently exists in the African entrepreneurial ecosystem.”

Adamou Labara, IFC’s country manager for South Africa, said increasing access to venture capital promoted digital entrepreneurship and innovative tech solutions that enable better delivery of vital services such as healthcare, fintech, and logistics.

“By supporting funds such as Knife III, IFC can help more startups and digital entrepreneurs innovate and expand in South Africa and beyond,” he said.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

IFC Completes $10m Investment In South African VC Knife Capital

February 11, 2022

The International Finance Corporation (IFC), a development finance institution, has invested $10 million in Knife Capital ’s Knife Fund III, a venture capital firm, to assist growth in South Africa’s digital economy and enhance access to financing for the country’s technology entrepreneurs.

“We are excited to welcome the IFC as an investor to our new Fund III and sincerely appreciate the endorsement that comes with the commitment.

“With the first close of Fund III, we are finally able to support entrepreneurs in the next stage of the scale-up journey and, thereby, address a significant gap that currently exists in the African entrepreneurial ecosystem,” says Knife Capital partner Andrea Bohmert.

According to the IFC, the investment in Knife Fund III would provide financial support to digital entrepreneurs in high-growth industries in South Africa, such as enterprise technology, software, health technology, and financial technology, with strong potential for expansion throughout Africa and beyond.

Knife Capital hopes to raise $50 million for Fund III, which will focus on investments in the series B, or second round, stage. Knife Fund II debuted in 2016, and Knife Fund I debuted in 2010.

“Increasing access to venture capital promotes digital entrepreneurship and innovative tech solutions that enable better delivery of vital services such as healthcare, fintech and logistics. By supporting funds such as Knife III, the IFC can help more startups and digital entrepreneurs innovate and expand in South Africa and beyond,” says IFC South Africa country manager Adamou Labara.

South Africa’s Internet economy has the potential to grow from $21 billion to $31 billion between 2020 and 2025, and up to $125 billion by 2050, according to the IFC-Google paper ‘eConomy Africa 2020.’ According to the development financing organization, it will be vital to equip local digital companies with the capital they need to establish and scale their goods and services in order to enable this growth.

“In South Africa, the level of fundraising volume is relatively high compared to the rest of sub-Saharan Africa, but most venture capital supports early-stage companies in the country, with limited funding available for Series B or later stages of investment.

“The IFC’s investment in Knife Fund III aligns with its strategy to provide patient risk capital to fund managers in Africa and to support Africa’s technology ecosystem,” the organisation says.

Knife Capital IFC Knife Capital IFC

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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.
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