Endeavor South Africa has secured R190 million in the first funding round of its R500 million fund, Harvest Fund III, which is destined for investment in African tech start-ups and companies.

Exceeding the first close funding target of R150 million, the fund’s aim is secure R500 million to invest in high-potential tech companies across Africa.

The first close of Harvest Fund III coincides with the final investment of Harvest Fund II, which was established in 2021, and which, coincidentally, invested R190 million in in 17 companies.

According to the company, notable investors in Harvest Fund III included Standard Bank, Allan Gray, and the SA SME Fund.

The fund says it aims to invest in a vetted pipeline of 135 selected Endeavor companies in Africa. Although it expects 85% of the funding value to go into companies from South Africa.

For Alison Collier, MD, Endeavor South Africa, the due diligence taken to build the pipeline will be key to the ultimate rewards. She said: “We have a deep understanding of the 135 businesses in our pipeline and are confident in their growth potential, as they have been selected through Endeavor's rigorous two-stage international selection process, which spans one to two years.”

The fund seeks a 25% return, translating to three to four multiples on invested capital.

Endeavour is following a similar philosophy to that which was behind Harvest Fund II, which backed 17 companies and delivered 58% annual revenue growth, R7.7 billion in revenue, as of end 2023 and created over 9 200 jobs.

Notable investments include unicorns like Go1 and TymeBank, and high-growth companies such as Clickatell, Sendmarc, and digital payment innovators Onafriq (formerly MFS Africa), iiDENTIFii, and Ozow.