US$100m cash injection to help out West African tech start-ups
Constant Ventures, a part of the Constant Group, is raising a US$100-million venture capital fund to invest across a range of technology start-ups with a focus on financial inclusion, education and healthcare.
The Constant Group was founded in 2006 and comprises two divisions Constant Capital and Constant Ventures with a combined total of 40 professionals.
Constant Capital, a West African merchant bank has - to date – claims to have arranged over US$3-billion for various Nigerian institutions, including international money earmarked for local banks that was raised from both international banks and global hedge funds.
Constant Ventures was established to provide capital to a portfolio of tech-enabled companies across the Fintech, healthcare and logistics sectors. It has to date invested approximately US$3.2-million in nine companies and is projecting a 15x return after the next funding round.
In this latest capital raise, investee companies will initially be located across Nigeria and Ghana, with the fund set to target the wider West Africa region.
According to Constant Ventures, recent advances in digital IT “provide an opportunity to both build and scale solutions to everyday challenges faced by millions of Africans – in particular, the aggregation of fragmented value chains, the formalisation of large sectors of the continent’s economy and the provision of much-needed access to financial services for both consumers and businesses.”
Constant Ventures created the fund on the back of its successful track record as an angel investor, as well as a respected developer of technology businesses. To-date, it has invested US$3.2 million in nine Nigerian start-ups, with a return of 5.6x, which is projected to return 15x after the next funding round.
Ike Echeruo, Chairman of the Constant Group and co-founder and Managing Partner of Constant Ventures, says: “We are very excited to be announcing this fund today. It has been a decade in the making, the result of deep-dive research and due diligence in anticipation of this moment when we knew that advances in information technology would enable start-ups across West Africa to commercially address real societal needs.
“Technology was always going to provide the answer to so many of the critical issues faced by millions of people across Africa today. We are now on the cusp of a paradigm shift with recent advances across information technology presenting a unique investment window. We have looked at what has worked in other geographies. Now, refined and optimised for Africa, we have modelled a fund to invest in businesses that will both improve the lives of millions of people and deliver outstanding returns for investors.”