Velocity Capital Launches $120m Venture Fund that Could Target African Fintech Startups

Netherlands-based private equity firm, Velocity Capital has launched a $120 million fund targeted at fintech startups. The European venture firm will invest in early stage startups developing financial solutions for consumers, financial institutions, and other areas of the fintech value chain.

Velocity Capital is one the leading firms taking interesting bets on Africa’s financial future. Over the last two years, the VC has invested heavily in three of the continent’s biggest fintech startups. For instance, in March 2017, the firm lead the $3 million financing round in South Africa’s Yoco.

Velocity Capital Launches $120m Venture Fund With Some Focus on African Fintechs
Velocity Capital Invested in South Africa’s Yoco

It followed that up in 2018 by participating in another $16 million funding round in the same startup. And in August 2018, Velocity participated in the $13 million funding round in Mines.IO, a Nigerian fintech company.

Velocity’s third African investment is no other than Cellulant, the Kenyan payments company taking giant leaps to integrate local options like mPesa to the global financial system. Interestingly, all three investments are spread across the three regions of Sub-Saharan Africa.

Now however, Velocity Capital has signaled it is ready to make more disbursements to startups developing innovative solutions in the fintech space.

“At Velocity, we are interested in funding founders who demonstrate a vision for applying fintech to improve the human experience, the tenacity to make it a reality no matter what, and a business model that is already showing traction,” said Willem Willemstein, founder of Velocity Capital.

Velocity Capital Launches $120m Venture Fund With Some Focus on African Fintechs
Velocity Capital has invested over $80 million in various startups, including Nigeria’s Mines.IO

Over the last four years, Velocity Capital has invested over $80 million in various companies across the world. In particular, it has focused much of its financing on European and Africa based companies.

However the company looks set to maintain this recipe with the new fund. And one Kenyan investment research company is bullish about the potentials for the funds in Africa.

According to Cytonn Report, the new funds would increase investments “in fintech companies across Africa and the resultant growth of Africa’s fintech segment due to increased access to capital”.

We have reached out to the venture firm for more information about the funds but we were yet to receive a response by the time we published.

Regardless though, we maintain a positive outlook about what the fund represents for African companies.

The continent is already witnessing an interesting increase in the number of venture funds. Added to this is high interests from development finance institutions. No doubt, Velocity would want to capture a piece of the action. Thus targeting Africa’s fintechs is a must.


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