Jake Bright Contributor Jake Bright is a writer and author in New York City. He is co-author of The Next Africa. More posts by this contributor Marieme Diop and Shikoh Gitau to speak at Startup Battlefield Africa Local venture capital fund formation is on the rise in Africa, led by Nigeria
Naspers announced a $100 million Naspers Foundry fund to support South African tech startups. This is part of a $300 million (1.4 billion rand) commitment by the South African media and investment company to support South Africa’s tech sector overall. Naspers Foundry will launch in 2019.
The initiatives lend more weight to Naspers’ venture activities in Africa as the company has received greater attention for investments off the continent (namely Europe, India and China).
“Naspers Foundry will help talented and ambitious South African technology entrepreneurs to develop and grow their businesses,” said a company release.
“Technology innovation is transforming the world,” said Naspers chief executive Bob van Dijk. “The Naspers Foundry aims to both encourage and back South African entrepreneurs to create businesses which ensure South Africa benefits from this technology innovation.”
After the $100 million earmarked for the Foundry, Naspers will invest ≈ $200 million over the next three years to “the development of its existing technology businesses, including OLX, Takealot, and Mr D Food…” according to a release.
In context, the scale of this announcement is fairly massive for Africa. According to Crunchbase data recently summarized in this TechCrunch feature, the $100 million Naspers Foundry commitment dwarfs any known African corporate venture activity by roughly 95x, when compared to Safaricom’s Spark Venture Fund, Interswitch’s E-Growth Fund, and Standard Bank’s several million dollar commitment to Founder Factory.
Naspers is one of the largest companies in the world—85th by its $108 billion market cap, just after Nike—and one of the world’s largest tech investors.
Aside from operating notable internet, video, and entertainment platforms, the company has made significant investments in the Europe, India, Asia, and South America. In 2018 Naspers invested $775 million in Germany’s Delivery Hero, $124 million in Brazilian e-commerce company Movile, and added $100 million to its funding to Indian food delivery site Swiggy.
Naspers was also an early investor in Chinese tech group Tencent, selling $10 billion in shares this year after a $32 million investment in 2001.
The South African media group has invested less in (and been less successful) in Africa, though that comparison comes largely by contrast to Naspers’ robust global activities.
One of Naspers early Africa investments, Nigerian e-commerce startup Konga, was sold in a distressed acquisition earlier this year.
The company recently added to around $70 million to its commitment to South African e-commerce site Takealot. And in perhaps a preview the company was shifting some focus back to Africa, Naspers made one of the largest acquisitions in Africa this September, buying South Africa’s Webuycars for $94 million.
The $300 million commitment to South Africa’s tech ecosystem signals a strong commitment by Naspers to its home market. Naspers wasn’t ready to comment on if or when it could extend this commitment outside of South Africa (TechCrunch did inquire).
If Naspers does increase its startup and ecosystem funding to wider Africa— given its size compared to others—that would be a primo development for the continent’s tech sector.