Oui Capital, an early-stage pan-African venture capital firm, is closing its second $30 million fund for the first time.

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Ui CapitalThe Africa-focused venture capital firm based in Lagos and Massachusetts announced today the completion of the first close of its second $30 million Oui Capital Mentors Fund II as it seeks to boost its presence on the continent.

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Company founded in 2019 Olu Oyinsan as well as Francesco Andreoli, launched its $10 million debut fund. Since then, Oui Capital has made 18 investments in technology sectors, covering various industries such as financial technology, logistics and mobility, e-commerce, healthcare, and enterprise software. Some names include TeamApt, MVHAkiba Digital, HollowNdovu, Maad, Intelligra, Ifluence and pharmacy markets.

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Oui Capital made eight investments last year, and this second fund signals venture capital’s intent to keep up with that pace. The $30 million fund, like the first, will support sub-Saharan startups in the pre- and seed stages. The firm has achieved its first close of just over $11 million so far and expects to complete its final close by the fourth quarter of 2022.

Oui Capital’s managing partner, in an interview with TechCrunch, said Oui Capital’s inaugural fund delivered solid early returns, with MOIC (multiple on invested capital) exceeding 7 times. He said that one of the reasons the firm was able to pull this off is because “sparks” which determine which startup to invest in or not: the team, the market, knowledge of the client and technology, and the enthusiasm of the client.

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But even though firms follow guidelines (like Oui Capital and its aforementioned investment strategies), not all deals end up being successful. Oui Capital is providing more extensive support to some of these start-ups by facilitating partnerships and sales, facilitating recruitment and providing bridge investments. Regarding follow-on capital, the managing partner said that Oui Capital is actively making such investments as part of the ongoing monitoring of the firm’s portfolio. Oui Capital has now made follow-on investments in approximately 20% of its portfolio companies.

“We go the extra mile with the founders we partner with and therefore have a relatively smaller portfolio compared to many seed funds. However, there is a critical difference between the responsibilities of venture capital as an investor and as a fund manager,” said the managing partner.

“Being an investor breeds unwavering optimism and support, as described earlier. Being an effective fund manager also places a fiduciary responsibility on you to know when to stop devoting scarce resources to problems that may be too difficult to solve and direct those resources to better performers in your portfolio to minimize losses and maximize value. for investors.”

Team Oui Capital

Team Oui Capital

While economic cycles like the one experienced by the startup world are usually short or medium term, Oijinsan echoes what local investors have been reporting over the past few months: a return to commitment to fundamentals and support for companies with strong fundamentals, unit economics and valuation. . discipline. This event gave investors, including Oui Capital, an opportunity to invest in the chain, especially now that it has recently received capital injections.

The firm will aim to cover the full range of investments up to Series A, including interim rounds, an activity it will step up especially during the current venture capital crisis, Oyinsan said. In related news, Zedcrest Capital, another venture capital firm, launched $10 million “emergency fund” to rescue startups in pre-Series A stages last week.

From this new fund, Oui Capital intends to write initial checks of up to $750,000 (10 times the ticket size of its first fund) with reserves for such subsequent investments. “Expect to see us doing many more deals across the ecosystem and sounding solid initiatives — things we’ve done quietly for the last four years but now hope to double them with the new fund,” Oyinsan added.

The second Oui Capital fund welcomed both individual and venture capital investors as limited partners. It was attended by individual investors such as Brad Feld, Seth Levin and Ryan McIntyre (Partners of the Foundry Group), Gbenga Oyebode, Tokunbo Ismael of Alitheia Capital, Idris Alubankudi and TeamApt CEO Tosin Eniolorunda.

As one of the largest fintech companies in Africa (by revenue and market capitalization), TeamApt is currently a breakthrough in Oui Capital’s portfolio. Fintech, which according to sources is in the market to raise next year’s Series C round, is one of the most celebrated fasthorns on the continent. Thus, Eniolorunda becoming a limited partner in the firm is admirable, as founders in these parts become co-owners of the funds that backed their start-ups, a rare feat. Another example is Paystack CEO Shola Akinlaid and pan-African early-stage fund Ventures Platform.

“This is great feedback for us as a venture capital firm that speaks to the strength of our working relationship with TeamApt even before our investment in the company,” Peter Oriafo, director of Oui Capital, TechCrunch, said of Eniolorunda’s involvement in the LP. “The founder-investor relationship is a testament to our work in supporting the founder in the early stages and making the company successful to the point where they want to pay up front.”

Oui Capital invested in TeamApt when the fintech company was on the radar and before it caught the attention of other investors. Its success is one of the inspirations for Oui Capital’s pan-African approach. The firm is looking to make new investments in start-ups that it believes can be winners in their respective countries and sectors, Oyinsan said. Oui Capital cites Maad (the first B2B marketplace for consumer goods in Senegal) and Pharmacy Marts (B2B marketplace for pharmacies in Egypt) as examples.

As a result, African countries in which Oui Capital has made at least one investment include Nigeria, Kenya, Senegal, Egypt and South Africa. The firm plans to invest more in North Africa and Francophone Africa, regions that saw a rise in startup and venture capital activity last year when African tech funding reaches record high according to global figures.

“Our pan-African strategy has made us the fund of choice for global LPs looking for broader access to Africa without having to deal with different regions individually,” Oyinsan said. Global venture capitalists involved in this second fund include Angur Nagpal’s Vibe Capital, D Global Ventures, Boston-based One Way Ventures and Ground Squirrel Ventures.

Credit: techcrunch.com /

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