Norrsken22 closes $205m fund to invest in Africa’s growth-stage startups

Onome Amuge

Despite the recent slowdown in tech investment and venture capital activity globally, Pan-African venture capital firm Norrsken22 was able to reach its final close for its debut fund with $205 million in total capital raised. This was supported by renewed fundraising momentum at the beginning of the year, demonstrating the strong appetite for African tech investment.

With the final close of its debut fund, Norrsken22 has demonstrated the growing appetite for investment in Africa’s startup ecosystem from institutional investors. The firm, founded by experienced venture capitalists and private equity investors, has also exceeded its initial fundraising target, highlighting the confidence of its investors in the potential of the African tech sector.

The Norrsken22 African Tech Growth Fund was first launched in January of 2022 with an initial target of $110 million. In addition to investment from institutional investors, the fund has attracted significant contributions from a consortium of 30 unicorn founders globally, who collectively contributed approximately 59 per cent of the total capital raised.

The fund’s investors include some of the world’s most successful tech founders, including Niklas Zennström of Skype, Niklas Östberg of Delivery Hero, Olugbenga Agboola of Flutterwave. The fund is focused on identifying and investing in the next generation of tech giants in Africa, particularly in high-growth sectors like fintech, edtech and mediatech.

Natalie Kolbe, the managing partner of Norrsken22, in his remarks on the fund’s investment strategy,attributes this success to the team’s deep experience in African investments and the support of high-profile limited partners.

In terms of investment strategy, Norrsken22 will primarily focus on Series A and B rounds, in order to bridge the gap between growth and late-stage funding for African startups. The firm will allocate around 50 per cent of its capital to early-stage companies, while the remaining 50 per cent will be used for follow-on investments in later stages. In terms of sectors of interest, fintech, edtech, medtech and market-enabling solutions with a positive social and environmental impact will be the primary focus. The firm is aiming to create long-term value and sustainable growth in the African tech ecosystem.

So far, Norrsken22 has made five investments, including TymeBank, a digital bank; Sabi, a B2B commerce platform; Smile Identity, an identity verification solution; Autochek, a platform for auto financing; and Shara, a financing app. The fund aims to make a total of around 20 investments, with an average investment size of $10 million.

Looking to the future, Norrsken22 is focused on preparing its portfolio companies for potential exits. The firm is actively assessing exit scenarios and identifying potential buyers for its portfolio companies. This includes assessing interest from international strategic buyers, consolidations involving local industry leaders, and acquisitions by large multinational corporations in Africa.