Swedfund invests in African tech entrepreneurs and promotes increased digitalisation
Introduction
Investment in digitalisation in developing countries is central to reducing both financial and digital gaps. Hence, the Swedish development finance institution, Swedfund, invests in a fund focusing on developing young companies and supporting entrepreneurs working with digital business models spun out of local needs in Africa. The investment of USD 10 million is made in TIDE Africa Fund II, a venture capital fund dedicated to financing the development of scalable and innovative business models.
The lack of connectivity combined with insufficient access to digital services limits development and restrains inclusive and sustainable growth. To foster development, there is a need for capacity building in the form of infrastructure, education, and predictable legislation, as well as investments in infrastructure and sustainable business models based on local needs.
- Investments are needed to facilitate the use of new technologies as accelerator for development and poverty reduction. By providing funding to entrepreneurs at an early stage, we can support the development of digital business models based on local needs, says Maria Håkansson, CEO of Swedfund.
Development finance institutions can enable and promote efforts to accelerate sustainable development in several ways, including investment in cost-effective and digital solutions that contribute to job creation, increased accessibility to products and services in developing countries, and the emergence of new and innovative solutions, for example within education, healthcare, financial services, and logistics.
- This is a milestone because we have been working persistently for a long time to find a partner with a strong position and experience of growing and developing digital solutions from an early stage spun out of local needs. As a development finance institution, we can contribute with long-term capital in combination with knowledge and long experience of working with sustainability, says Maria Håkansson.
There are considerable opportunities for sustainable investment in Africa and if more parties join forces, we can create a greater impact that benefits the development for millions of people, says Maria Håkansson, who also emphasises that Swedfund wants to contribute to mobilising institutional and commercial capital.
TIDE Africa Fund II is expected to generate both direct and indirect employment, create local economic development and provide solutions to the needs for essential products and services locally.
About TLcom
TLcom is the manager behind Tide Africa Fund II. TLcom’s first African fund, Tide Africa Fund I, has invested in small and unlisted growth companies in sub-Saharan Africa since 2017 and has extensive experience in supporting entrepreneurs working with sustainable, scalable and innovative business models.
TLcom has a presence in Lagos, Nairobi and London, enabling interaction with entrepreneurs, portfolio companies and investors. The manager has previous experience of working withseveral other development financiers through its Tide Africa Fund I.